Losses stemming from floods that devastated parts of western Japan in June and July are expected to cost insurers between $2.6bn and $4bn, according to AIR Worldwide.
The catastrophe modelling firm said successive heavy downpours from 28 June to 8 July led to widespread inland flooding in more than 30 districts across western and south-central Japan.
AIR said it was Japan’s deadliest flood since 1982 and the country’s deadliest natural catastrophe since the 2011 Tohoku earthquake.
The modelling agency said its estimates were based on damage to property – both residential and commercial – as well as automobiles and contents on individual properties.
However, the estimates do not include damage from landslides, losses to land or infrastructure, business interruption costs, loss adjustment expenses or demand surge for the cost of materials or labour in the wake of a catastrophic event.
Earlier this month, Japanese insurer MS&AD warned that it expected gross losses of around 66bn yen ($594.8mn).
Days later, rival carrier Tokio Marine Holdings said it expected to pay out 50bn yen ($451.8mn) for losses stemming from heavy rain in its Japanese heartland.
In an early estimate last month, Aon said economic losses from the floods, which reached 5 meters in places, shutting down a number of car and electronics manufacturing facilities, were likely to top $1bn.
“The scope of damage to physical property, vehicles, and infrastructure alone suggests the financial cost reaching substantially into the hundreds of millions of dollars, and almost certainly higher,” the broker went on.
It said that in Japan flood cover tended to be bundled with with homeowner or commercial property insurance policies.
“There is likely to be some insured business interruption losses as well given the multi-day shutdowns for some manufacturing facilities.”
Car manufacturers Toyota, Mazda and Mitsubishi all halted production in a number of plants around the country.
Meanwhile, electronics firm Panasonic had to shutter operations after one of its factories was flooded causing a power cut. Brewing company Asahi also closed one of its factories.