Even if the insured losses from the Chile earthquake fall in the mid-range of current estimates of between US$ 2 billion and US$ 8 billion, it will outpace Hurricane Wilma as the most expensive insured event in Latin America's history, according to a release by reinsurance broker Cooper Gay.
Individual companies have also continued to release estimates of their exposure to the earthquake: Flagstone Reinsurance Holdings (US$ 50 million); Max Capital Group, Ltd. (US $10 to 20 million for both the earthquake and Xynthia), Platinum Underwriters Holdings (US$ 85 million from Q1 catastrophes), Validus (US$ 170 million to 270 million from Chile), Hiscox (US$ 100 million from Chile and Xynthia). Swiss Re and Munich Re had previously released estimates for exposure to the Chilean earthquake that combined to total over US$ 1 billion.
Some compliance and coverage issues have also begun to emerge from Chile as investigation of losses progresses: (1) Chilean law requires that losses be investigated and estimated by companies or local registered "liquidators" – any performance of duties reserved for such licensed professionals by foreign adjusters may pose regulatory compliance issues; (2) verification of entitlement to the expanded claim notice period agreed-to by local insurers for insureds impacted in particular ways by the earthquake; (3) potential conflicts (and ramifications thereof) between local insurers' obligations to their insureds under local law and policies and their duties of cooperation/claims control under reinsurance agreements; (4) difficulties adjusting business interruption claims that in some instances will dwarf property damage; (5) detection of earthquake claims by insureds with no such optional coverage under their fire insurance policies; and (6) potential coverage/rescission issues posed by failure to build up to local code.
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