The earthquake that tore through Chile may have caused more than US$15 billion in damage. (Joe Raedle/Getty Images)

SANTIAGO, Chile – The Chile earthquake, which was the fifth-strongest that has been documented in a century, could cost insurers between US$4 billion to US$7 billion, according to estimates by the world’s biggest reinsurance companies. It also could be the second-most costly earthquake in the past three decades, trailing only the 1994 earthquake in Northridge, Calif., which cost the insurance industry about US$15.3 billion, according to Munich Re, the world’s largest reinsurer, in a story published by the Bloomberg news service. The Munich-based company said on March 9 its own claims that are related to the 8.8-magnitude earthquake on Feb. 27 will be about €400 million (US$543 million). Meantime, the second-biggest reinsurer, Zurich-based Swiss Reinsurance Co., put its estimates at US$500 million. “Anti-seismic features installed in properties across the country seem to have prevented the collapse of many buildings, but it is unknown how many of them suffered serious damage and will require major repairs or demolition,” Swiss Re wrote in a statement. “And since residential policies covering mortgaged apartments and houses make up a large percentage of Chile’s earthquake insurance portfolio, damages to these types of properties will substantially add to the overall insured loss, together with damages to large industrial entities.” But the total economic losses as a result of the earthquake and tsunamis in Chile could exceed US$15 billion, according to Swiss Reinsurance Co. AIR Worldwide, a firm based in Boston that specializes in assessing damages inflicted by natural disasters, agreed with the US$15 billion estimate, according to Bloomberg.

Chile restores normal basic services after earthquake

Chile has moved beyond the emergency response part of the recovery process from the earthquake, as it has provided food, shelter and medical assistance to those in areas that were most affected by the event on Feb. 27. “We are surpassing the toughest phase of the emergency, as we have been able to give water, food and shelter to the thousands of victims affected in the center-south of the territory,” Patricio Rosende, the country’s interior vice minister told the Chinese news agency Xinhua. He said the government has set up water distribution points in the areas that sustained the most damage. Rosende added that about 10.6 million have had water service returned to their homes, 589,000 are getting their water via trucks, and electricity has returned to 90% of buildings. “There will be subsidies for the families to repair their houses,” he told Xinhua, adding there were 23,248 buildings that were damaged, and 6,378 more that were considered severely damaged. “If the damages are irreparable, and the related directions of the municipalities declare the buildings uninhabitable for the families, they could receive a new subsidy.”

Bachelet’s approval remains strong as term ends

Chilean President Michelle Bachelet, whose terms ends on March 10, still will leave office with the highest approval rating in the country’s history after she was widely criticized for the government’s handling of the natural disaster. Bachelet, who before the earthquake had an 84% approval rating – one of the highest in the Western Hemisphere – maintained the high number after the country was rocked by an 8.8-magnitude earthquake, according to a survey by the polling company Adimark GfK, Reuters reported. Seventy-five percent approved how she handled the aftermath of one of the world’s most powerful earthquakes in the past 100 years. Bachelet, who was prohibited by the Constitution from running for a consecutive term, will be replaced by business mogul Sebastián Piñera on March 11. Fifty-nine percent of the 1,129 who were surveyed over the telephone from March 3-6 said they were confident the country will do well under Piñera. Adimark GfK said it could not talk to a larger audience because many of the country’s telephone lines were down as a result of the natural disaster, Reuters reported.