International

Initial insurance losses from Tianjin blasts seen at $1.5bn

HONG KONG: Two explosions in the Chinese port of Tianjin last week that killed more than 100 people could generate total insurance losses of $1 billion to $1.5bn, Credit Suisse analysts said, citing initial estimates based on Chinese media reports.

Tianjin, the world’s third-largest port in terms of total cargo volume, was hit on Aug 12 by blasts that damaged a large industrial area and sent shockwaves across several kilometres.

Insurance companies including Zurich Insurance Group AG and Allianz SE said they had received claims from clients that had been affected by the disaster but could not provide any estimate of the potential losses.

“Based on the available information, we do not anticipate major financial claims to arise from this incident, but we continue to assess the situation,” Allianz, Europe’s largest insurer, said in a statement.

Chinese insurers are also expected to be affected.

“It is still very early to determine the level of insured losses, but the event is likely to be large with initial insured loss estimates of $1-$1.5bn and a large number of insurance companies affected,” analyst Arjan van Veen said on Monday in a note, in which he compiled estimates from a range of Chinese media reports.

Credit Suisse said those affected would be mostly Chinese insurance companies as well as international groups that either insure multinationals or provide re-insurance coverage.

As of Monday evening, global automakers had confirmed 4,950 cars were damaged in the blast, with most saying the vehicles were insured but declining to provide additional details.

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