Ike Damages Estimated To Be Costly

Although the total losses caused by Hurricane Ike have not been tallied as of Monday, insurers are pegging initial estimates at amounts ranging from $6 billion to $18 billion.

The most significant damages will stem from the cost of claims to oil and gas platforms in the Gulf of Mexico, which have yet to be assessed.

Platform personnel were scheduled to head to their facilities to assess the damages beginning this week.

The storm prompted a rise in energy prices throughout the continent in case production was stymied on a longer-term basis in the wake of Ike’s wrath.

Ike made landfall in Galveston, Texas on Saturday as a Category 2 storm although the damages weren’t as significant as initially anticipated. Houston, United States’ fourth largest city, also got hit, with extensive power outages and damage to utility services along with flooding expected to last a week or more.

The biggest property insurers in Texas, and the most exposed to claims in the heavily populated coastal region, are State Farm Group, Allstate Corp, and Farmers Insurance Group.

The three together account for about half of the insurance market in Texas, according to insurance ratings agency A.M. Best.

As of Monday, thousands of Galveston residents and those of neighboring communities were just beginning to return to their homes to assess damages, an indication that the total losses won’t be formally be known for some time.

While losing its force over the continental U.S., Ike is poised to unleash the remnants of its wind and rain early this week over parts of Southern Ontario.

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