MEXICO CITY (Dow Jones) -- The strong earthquake that struck Mexico on Tuesday may trigger 2.07 billion pesos ($162 million) in payouts for damages to insured property, Mexican insurance association AMIS said Friday.
The estimate is based on the magnitude of the tremor, which reached 7.4 on the Richter scale, AMIS said. Had the quake hit a magnitude of 7.8, as initially reported, then damage estimates would have been closer to MXN5.60 billion.
The insurance association predicts that 80% of the insured damages took place in the state of Guerrero, with some damage claims also expected to arise in the Federal District as well as in the states of Oaxaca and Puebla.
While a 7.4-magnitude tremor is capable of causing major damage, the Mexican capital -- the country's economic heart -- escaped widespread damage.
Major international insurance companies operating in Mexico include MetLife Inc. (MET), AXA SA (>> AXA) and QBE Insurance Group Ltd. (>> QBE Insurance Group Limited).
Home insurance is not common in Mexico, with only mortgage debt typically covered by policies; just over 31% of homes carry some degree of insurance linked to a loan. Apart from obligatory coverage for debt on mortgaged homes, only 4.5% of homes are insured by their owners.
-By Amy Guthrie, Dow Jones Newswires; (5255) 5980-5177; [email protected]