Alberta Fires Worse for Canada Economy Than Katrina for U.S.
Intact Financial Corp. may post insured losses of as much as C$1.1 billion ($850 million) from the wildfires in Alberta, which could dent the Canadian economy harder than Hurricane Katrina hit the U.S.
Intact, Canada’s biggest property and casualty insurer, said the damage claims will lead to net losses of C$130 million to C$160 million, or as much as C$1.20 a share, according to a company statement Monday. Jaeme Gloyn, an analyst with National Bank of Canada Financial, estimated the C$1.1 billion figure based on the company’s per-share data. The Toronto-based insurer had net income of C$147 million in the first quarter.
“The devastation brought on by the wildfires is unprecedented,” Intact Chief Executive Officer Charles Brindamour said in the statement. “The scope of the damage and destruction that we have observed in recent days is a reminder of the important role we play in getting our customers back on track.”
The fires have covered 965 square miles and devastated the town of Fort McMurray, which was evacuated last week. It’s likely to be the costliest natural catastrophe in Canadian history, Fitch Ratings said Monday in a statement.
Insured Losses
Industrywide insured losses could reach C$9 billion, according to reports from Bank of Montreal and others. With Canada’s 2016 gross domestic product estimated at $1.8 trillion, or about 10 percent of U.S. GDP, the disaster could be bigger on a relative basis than Katrina, based on an analysis by Imperial Capital. Katrina, the storm that hit New Orleans in 2005, cost $60.5 billion, according to data from Munich Reinsurance and the Insurance Information Institute.
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http://www.bloomberg.com/news/articles/2016-05-09/alberta-fires-worse-for-canadian-insurers-than-katrina-for-u-s
