Louisiana Insurance

Hurricane Rita is perhaps more expensive, including insurer Allstate Corp. and St. Paul Travelers Cos. $ 2.5 billion to 6 billion U.S. dollars, within a few storms last year in Florida.

The estimates are low for a storm Rita with their intensity, because its winds, click on the sparsely populated west coast of Louisiana, two storm modelers said. Eqecat Inc. forecasts $ 3 billion to $ 6 billion, and AIR World Wide Corp. estimated at $ 2.5 billion to U.S. $ 5 billion.

If $ 6 billion, Rita would cost as little as a third of what some analysts had expected and a fraction of $ 40 billion to 60 billion dollars estimated for “Katrina” probably the most costly disaster in ‘history of the industry. Charley and Ivan, two of the four hurricanes to hit record in Florida during the last years, cost insurers more than $ 7 billion.

“ It is rather an ordinary type storm,’’said Bob Hartwig, chief economist at the Insurance Information Institute, an industry group in New York. Insurers are likely to be “ breathe a collective sigh of relief.”

With wind speeds of 120 km / h, Rita has come ashore near the border with Texas, Louisiana as a Category 3 hurricane on the Saffir-Simpson scale, after the maximum category 5, there are two days. The storm north of the series yesterday on the Gulf of Mexico, of course, changed plans perhaps have been devastating for Houston’s oil refinery hub.

Oakland, California based Eqecat estimated $ 9 billion to 18 billion dollars in principle yesterday, Rita would be the case in the country and more sweeping densely populated areas. As of today around 1 pm local time, Rita had slowed to a tropical storm with winds of 65 kph (105 kph), the National Hurricane Center said. He was outstanding between Shreveport, Louisiana and Lufkin, Texas, the Centre said.

`Lucked Out ‘

“ Many cities lucked out, especially Galveston and Houston,’’said Jayanta Guin, Vice President of research and modeling at AIR-Boston World Wide, the computer used for measuring risk insurers.

Investors were evaluating stocks insurance, as if it would be $ 10 billion to 20 billion dollars of damage insured by Rita, Wachovia Corp. analyst Susan Spivak said in a report September 22 AG Edwards & Sons Inc Paul Newsome, an analyst had predicted $ 10 billion.

State Farm Mutual Automobile Insurance Co., owned by their policyholders, is the largest insurer of the house arrest in Texas, Allstate, and Zurich Financial Services AG Farmers Insurance unit, according to a research report by Merrill Lynch & Co. . St. Paul Travelers insured most commercial real estate in the country, followed by Zurich and Chubb Corp., Merrill said.

Stocks Advance

The 22 member Standard & Poor’s 500 Insurance Index advanced 1 percent yesterday, the second day of profit after just three rejects, as the storm weakened to a category 3

Allstate rose $ 2.59 or 5 percent to 54.53 dollars in New York Stock Exchange Composite trading. St. Paul Travelers rose 76 cents or 1.8 per cent to $ 42.75.

Risk Management Solutions Inc., third Modeler, the highest estimate on Katrina, to $ 40 billion to 60 billion dollars. That would be two to three times more expensive than Hurricane Andrew in 1992 and may be eroded as much as 15% of U.S. $ 402 billion damage that insurers have in surplus or cushion for high tariffs unexpectedly.

“ Given the loss of “Katrina”, another $ 30 to $ 40 billion storm would have the potential to change the pricing dynamics in the industry,’’said Adam Klauber, an analyst at Cochran Caronia Securities in Chicago.

Instead, the insurer will probably continue to lower prices as competition increases, he said. Prices have increased, had the September 11 terrorist attacks and corporate scandals as Enron Corp. began to fall during the past year.