Catastrophe risk modeling firm AIR Worldwide estimates that insured losses from Monday's magnitude 6.3 earthquake that struck the Abruzzo region of Italy are likely to range between Eu200m ($265m) and Eu400m.
The estimates include losses to residential, commercial and industrial buildings and contents but do not include business interruption losses. Total damage for the quake is estimated at between Eu2bn and Eu3bn.
"While damage from this event will likely be between two and three billion Euros given the scale of destruction, insured losses will be limited due to the low penetration of earthquake insurance in the region," said Guillermo Franco, senior engineer at AIR. "Damage to commercial properties will likely drive the insured losses, since a higher proportion of businesses tend to purchase earthquake insurance."
Monday's earthquake occurred roughly 100 kilometers from a magnitude 6 earthquake that struck the Umbria-Marche region in 1997. According to a 2004 report from Axco, the 1997 event caused an estimated $4.5bn in economic losses of which less than 2% was insured.
"While the geographic extent of damage was fairly limited – to L'Aquila and nearby towns – the severity of damage within the affected area was high," said Franco. "Research published in 2005 points at the possibility of ground motion amplification in the city of L'Aquila due to the existence of an underlying sedimentary basin. Once ground motion records become available, we'll be able to discern whether this effect might have played a significant role in the destruction witnessed in this event."
An estimated 15,000 buildings were damaged in Monday's quake and tens of thousands of people have had to leave their homes while inspections are underway. In the nearby village of Onna, virtually every home was damaged or destroyed. Similar levels of destruction were reported in the nearby village of Tempera.
The historic center of L'Aquila has been devastated and damage to unreinforced masonry (URM) buildings is severe. Narrow streets have been made impassable by the rubble of collapsed URM houses – many of them more than 100 years old.
However, damage was not restricted to the oldest structures. Many reinforced concrete frame buildings dating from the 1960s and 1970s suffered heavy damage as well. Among these, the variability of damage is reported to be high, with one severely damaged next to another which appears to be intact.
Aftershocks continue to strike the area, including a magnitude 5.6 that struck the ancient mountain-top village of Fossa. The initial earthquake on Monday likely weakened some buildings making them more vulnerable to the aftershocks.