SURVEY: FIJI FLOODS COST $174 MILLION

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Report on January damage calls for insurance reform

SUVA, Fiji (Fijilive, Dec. 4 , 2009) – Fiji’s worst floods ever in January this year are estimated to have caused a total loss of $330 million [US$173.9 million] to areas covered in a survey of the western towns of Nadi and Ba.

The finding is contained in a socio-economist assessment report prepared by Suva-based SOPAC, the Pacific Islands Applied Geoscience Commission.

Apart from estimates of losses, the report makes recommendations on the need to facilitate greater access to insurance for businesses in flood-prone areas.

It also emphasises the need for government to manage the public’s perceptions of the cause of floods and determine how appropriate those perceptions are or risk being viewed as ineffective and irresponsible if it does not pursue solutions to causes that are not appropriate.

The report said the losses identified from the floods arose from structural damage, lost assets or possessions, medical impacts (for example injuries), evacuation or relocation of people or goods and the loss of wages and or business.

"The biggest single loss to families came from structural damage whereas the greatest single loss to businesses was from destruction of assets," the report said.

"In combination, the greatest single cost in the Nadi/Ba survey areas came from the loss or destruction of assets and possessions, accounting for 39 per cent of total losses - or almost F$130 million. Lost earnings were also substantial, accounting for a third of total losses at $100 million.

"This was mainly due to business losses as many businesses were unable to operate during or after the floods. It is possible that some businesses exaggerated loss estimates during the survey. However, outliers (unusually high values) were removed from calculations to redress this as far as practical."

The report said that while the scale of figures appeared high compared to infrastructure losses estimated by the government, it pointed out that household and business surveys following disasters were rarely carried so the magnitude of private losses is seldom estimated or learned.

Also, few respondents had any insurance which meant that private losses were rarely reported, even by the commercial sector.

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