Here are 5 of the biggest insurance claims in the world
1. The 2008 Financial Crisis, Claims: US $ 21 trillion
Subprime mortgage, housing loans given to debtors with a bad credit history or no credit history at all, are the trigger for the 2008 Economic Crisis. Property debts are held by financial companies, such as Lehman Brothers, Merrill Lynch, Goldman Sachs, Northern Rock, UBS and Mitsubishi UFJ, making the company go bankrupt.
The bankruptcy of Lehman Brothers triggered the intensity of the crisis throughout the world, including Europe. Britain announced a banking rescue package of at least 50 billion pounds (US $ 88 billion). Meanwhile, Germany provided assistance of 50 billion euros (US $ 68 billion) to save Hypo Real Estate Bank. In addition, a decline in interest rates also occurred at 0.5% in five central banks, namely the European Central Bank (ECB), Bank of England (BoE), Bank of Canada (BoC), Swedish Central Bank (Sveriges Riksbank), and Banks Swiss National (SNB). Not only banks, companies are also hit hard because they have to prepare funds for claims that are estimated to reach 21 trillion pounds.
2. Hurricane Katrina, Rita & Wilma in 2005, Claims: US $ 130 billion
Atlantic hurricanes that occurred in 2005 have triggered Hurricanes Katrina, Rita, and Wilma. The disaster claimed 3,913 lives. The cost of the damage reached US $ 158.9 billion, with around US $ 130 billion paid as insurance, while US $ 45 billion was paid for damage caused by Hurricane Katrina itself.
Katrina’s impact destroyed parts of the United States from Louisiana to the Florida Panhandle. The states of Louisiana and Mississippi became the worst areas, while 80% of the City of New Orleans was flooded after flood protection embankments collapsed.
Thousands of buildings were badly damaged, 1,800 people died, and more than one million residents were displaced. After the incident, insurance customers were busy filing claims for events that occurred, such as accidents, damage to homes, to life insurance, with a total of US $ 130 billion.
3. The bankruptcy of Lehman Brothers in 2008, Claims: US $ 100 billion
The loss of Lehman Brothers stemmed from the excessive number of subprime mortgages that swelled throughout 2008. The Fed had intended to liquidate assets from Lehman Brothers, but Lehman had fallen more than 90%. Finally, the company collapsed and was abolished from the New York Stock Exchange list.
It is estimated that the claims arising from the fall of Lehman Brothers touched US $ 100 billion.
4. WTC Tragedy September 11, 2001, Claim: US $ 40 Billion
Terror attacks on the World Trade Center (WTC) United States known as the September 11 (9/11) in 2001, has killed 2,996 people and injured 6,000 people. Material losses of US $ 123 billion as a result of the collapse of WTC building activity for approximately one month post-destruction.
The United States government should provide assistance amounting to US $ 15 billion for the airlines and that the plane was hijacked in the 9/11 attacks, the United Airlines and American Airlines. Insurance claims are also estimated to reach US $ 40 billion paid by insurance companies to victims as compensation.
5. Sandy Storm in 2012, Claims: US $ 36 Billion
The 2012 Atlantic hurricane season triggered the Sandy Storm sweeping the Bahamas, Eastern Canada, and most of the eastern US. Thousands of houses were damaged and the surrounding infrastructure was destroyed. Losses from these events are estimated at US $ 75 billion and 233 fatalities.
After the event, insurance companies were flooded with claims for damage and losses suffered by customers. The amount reached US $ 36 billion. But from the incident, it was alleged that many false claims or frauds so that thousands of customers’ claims must be rejected.
False claims are known after an engineer has inspected. At least, there are 175 claims of inspection results handled by companies to reduce or reject claims.