HAIYAN ECONOMIC IMPACT ON PHILIPPINES WILL BE MASSIVE

Typhoon Haiyan could have an economic impact on the Philippines of $12bn to $15bn, or 5% of Philippines annual output. An equivalent event for the US would be an economic loss of $750bn. Charles Watson, director of R&D at Kinetic Analysis, said that Haiyan would therefore have a relative economic impact more than five times as great as that of Hurricane Sandy, which hit the US Atlantic Coast in October 2012, causing $50bn in economic damage. Mr Watson estimated that between 10% and 15% of the losses in the Philippines could be insured. Others thought that the percentage loss could be even lower. EQECAT's Aarti Dinesh said that only about 15% to 20% of all Philippines property cover protected against typhoons. Aon Benfield thought that the insured loss would be "negligible:". The low level of penetration could mute any increase in economic activity, according to Robert Muir-Wood, chief research officer at catastrophe modeller RMS. Speaking to Bloomberg, he said that “the economic activity of reconstruction itself is much lower than it would be in a rich country where everybody’s using insurance and claims assessors and getting quotes from builders". He said that insured losses could arise from motor losses and from larger businesses with property in the area.