Up to $1 billion in costs due to Costa Concordia disaster

Experts have said that the Costa Concordia ordeal could cost the industry as much as $1 billion (£633 million).

Travel Insurance News - 02/02/2012

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The capsizing of the Italian cruise vessel came during an already difficult time and during a key booking season for the cruise industry, experts say, and will likely cost between $500 million and $1 billion even if tourists are not scared off.

Analyst Nicholas Johnson form Numis wrote this week that in addition to heavy losses for travel insurance companies that there were numerous players in the ordeal that are likely to see serious costs, noting that any single player had likely not carried in excess of 10 per cent of the risk.

Carnival Corp, the parent firm of Costa Concordia and several other major cruise lines including Carnival, Holland America, Cunard, Seabourn and Princess, has not yet given any indication of costs. However, experts say the company is will have to pay at least $40 million (£25 million) in the disaster according to insurance deductibles.

Meanwhile, experts say the firm and others are likely to struggle during the peak booking period as the Concordia remains capsized just offshore from the Tuscan island of Giglio. Eleven people have been confirmed dead in the ordeal and almost two dozen more are still unaccounted for.

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