The tsunami triggered by the seaquake in Southeast Asia may cause massive losses for insurers.

Munich Re, the world’s largest reinsurer, estimates losses to hover around 10 billion euros ($13.6 billion), more of a tentative estimate as the exact numbers are not yet available. Munich Re believes its own losses will total about 100 million euros, due to the fact that high-value insured property is restricted to tourist and harbor areas.

"In spite of the long coastlines affected, the burden on the insurance industry will be limited. The reason for this is that seismic flood waves do not usually reach much further than a few hundred meters inland," Munich Re said.

"What is more, in the majority of these countries, the earthquake risk (including tsunamis) is excluded in property insurance policies, and additional covers -- as well as life and health insurance -- are quite unusual."
The company called for measures to be taken to counter the climate change that in Munich Re’s opinion was responsible for the disaster.

"The terrible effects spreading all around the Indian Ocean and reaching as far as the Horn of Africa are a further reminder of the global threat from natural catastrophes," executive board member Stefan Heyd said in the reinsurer’s annual disaster report.

"They underline our long-standing demand for prompt and rigorous measures against global climate change. After the disappointing outcome of the recent climate summit in Buenos Aires, time is running out."
Southern Asia was hit on Monday by the most powerful earthquake in 40 years, resulting in a huge tsunami reaching 20 feet in height in some places that crashed on the shores of at least eight countries. The total death toll is reported to have surpassed 40,000 people.

The quake that measured 9.0 in magnitude struck in the Indian Ocean, not far away from the northern part of the Indonesian island of Sumatra. U.S. Geological Survey officials report that the earthquake was the biggest since the 9.2 magnitude earthquake that hit Alaska in 1964, and fourth largest since 1900.

Sri Lanka, India, Indonesia and Thailand were most seriously hit, accounting for the bulk of casualties. Deaths were also reported in Malaysia, Bangladesh, the Maldives and in Africa.

The tsunami that rose after the quake spanned the vast space of the Indian Ocean from Sumatra to the coast of Africa. As shock waves are not typical of the Indian Ocean the countries it washes lack an efficient system of early warning that is well developed in the Pacific Rim.