UBS Group AG is a Swiss multinational investment bank and financial services company which maintains a presence in all major financial centers.
The investment bank says that together the damage in the Bahamas and the United States could cause charges in the region of US $40 million.
Today almost 60 people have died in The Bahamas as a result of Hurricane Dorian which slammed into the island on 1 September. At least five deaths have been blamed on the storm in the south-eastern US and one in Puerto Rico. The category 5 hurricane with winds of 200mph, became the worst disaster in the island’s history.
” UBS said it expected Dorian to cause $5 billion to $40 billion worth of damage.”
Travelmarketreport.com said that in the Abacos and Grand Bahama Islands which have roughly 2,250 hotel rooms, which amounts to less than 15 per cent of the country’s room stock, there will be a significant impact in the short term on the tourism product.
New Providence [including the capital of Nassau and neighboring Paradise Island], which has more rooms was not significantly impacted by Dorian.
Still, the financial analysts say that with damage from the US added to the debacle in the Bahamas, reserves built up by reinsurers since Hurricane Maria in 2017, could be wiped out by the latest weather event.
UBS said Dorian could lead the companies to raise their prices.
Large parts of Greater Abaco Island were destroyed.
UBS said it expected Dorian to cause $5 billion to $40 billion worth of damage. The banking group noted that the two-year gap between Hurricane Maria in 2017 and Dorian allowed reinsurers to pull together US$30 billion in excess capital.
However, UBS estimated that Dorian could wipe out the reserve and lead reinsurers to hike charges.
UBS compared Dorian to 2004’s Hurricane Jeanne, which caused about US$5 billion in insured losses.