Analysts are ratcheting up their estimates of the economic costs resulting from superstorm Sandy, with the latest estimates climbing to $50 billion.
Before Sandy made landfall, Eqecat, a catastrophe-modeling firm that serves insurance companies, had estimated that it would cause between $10 billion and $20 billion in damage, with half of that covered by insurers. Today, the firm released updated estimates, saying that total economic costs will be between $30 billion and $50 billion. Of that, $10 billion to $20 billion will be insured.
“The large electric and utility losses will trigger significantly more insured losses (business interruption) than were expected from a more typical category 1 storm,” the company said. It also noted that the subway outages in New York City ramped up the expected losses – and that much remains uncertain.
Economist Mark Zandi of Moody’s Analytics also put his estimate at $50 billion, including roughly $20 billion in lost output and $30 billion in property damage. But Zandi warned that the estimate of property damage, in particular, could still rise as the full effects of the storm become clearer.
Here’s the Moody’s Analytics breakdown of Sandy’s costs: