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Now it's time for World Business Report.
Harvey could overtake Katrina as America's costliest hurricane,
but will Irma prove even more expensive?
We look at the spiralling cost of extreme weather and who pays?
The boss of Virgin Atlantic tells us how they're helping customers
in the Caribbean and aiding the recovery effort.
China's trade surplus with the US jumps in August.
As you've been hearing, it's one of the strongest storms
ever recorded and aside from the human cost of the disaster,
experts warn it could also be one of the most expensive.
Much depends on what happens when it reaches densely populated Miami
but estimates range from $70 to $190 billion.
The financial cost of this year's hurricane season is already
There's no official figure yet for Hurricane Harvey,
which caused severe flooding and displaced more than a million
But some including the Governor of Texas are estimating costs
it would put Harvey ahead of Hurricane Katrina in 2005,
officially the costliest hurricane in US history.
Katrina did damage of nearly $160 billion.
Until this year, nothing had come close to Katrina,
although Hurricane Sandy in 2012 caused more than $68 billion
But it's clear the economic damage from extreme
Since 1980, the US has experienced 212 major weather disasters
with costs totalling $$1.2 trillion.
So is climate change behind this spiralling bill?
"One of the things we know about climate change
is that a warmer atmosphere
So that means when a hurricane does hit, more rain can come out of that
hurricane and cause a lot more flooding.
Another thing is that warmer oceans feed the hurricane,
so a warmer ocean means stronger hurricanes.
In this particular basin it's particularly hard to see a past
event where so many hurricanes have occurred in such quick succession.
It's not just the number of hurricanes, it's the magnitude.
Bronek Masojada is Chief Executive of the Hiscox Insurance Group based
Thank you for coming in. Those figures we were talking about, those
are the total costs, when we talked about the costs the insurance
companies will pay out, that will be a smaller figure, but even after
that this is shaping up to be one of the most expensive years so far for
the insurance industries? So far we have spent between $10 billion and
$15 billion in Houston, it is much less than the actual cost because
few people in America purchase flood insurance. The real cost is much
higher. In terms of Irma, we expected to be a bigger cost. Most
people buy insurance against wind damage and so the economic cost
because of the insurance costs could be anywhere between $50 billion and
100 $50 billion, so a bigger proportion of the total cost. Lots
of people don't have insurance against flooding, white, our
premiums too expensive? It's the way the industry has evolved. -- why.
It's very seldom... Wins are more frequent than floods. It's available
either from private insurers or National Insurance -- wins. Many
people think it is too expensive. Many insurance companies did a dry
run of many scenarios, a cyber attack, a hurricane hitting Miami,
all within a two-week period to learn lessons about how to cope when
seismic events like these come in quick succession. What lessons did
you learn from that drive run and has it helped for you to prepare for
the hurricane season -- dry run. The last big event was Katrina in 2005
so we are out of practice. What the dry run made us realise is we need
to update our contingency plans and actually last week after the floods
in Houston we invoked that plan and it's really working. It's making us
pay claims faster, it means we're getting muggy to the people who need
it when they need it most quickly -- money. It's been incredibly helpful.
Do you think the record claims we will see from this season will have
an impact on the future of the insurance industry, our premiums
going to rise or will people be unable to get insurance? -- are the
premiums. I doubt people would be able to get insurance, this is why
we are here, we expect to pay all these claims. Overtime will premiums
go up? I expect we will see small to medium-sized increases -- over time.
The exact impact will depend on exactly where Irma goes and into
days, it will be the weekend before it hits the mainland Florida coast
and the actual hurricane path makes a big difference. 100 miles to the
east to west will make a big difference to the ultimate economic
cost but this is a big one. Thanks for your time.
We are also looking at the response of the airlines to Hurricane Irma.
They're putting on extra flights to get tourists home from Florida
and the Caribbean, but some are also starting to play
The Chief Executive of Virgin Atlantic, Craig Kreeger,
told the BBC's Theo Leggett how they are responding.
We've already started with today's like taking water and blankets on
with us. On tomorrow's flight we will take building materials and
roofing materials -- today's flight. We anticipate this being a long
rebuilding process and we are committed to the region. We've been
encouraging customers in Florida to come back early and we might we will
put an extra air plane on if we need to to help them get back on Friday
instead of waiting until the weekend. If we need extra flights on
Monday to take things there or bring people back then we will do so.
These are situations that as an airline we have an important role to
play, and no role we both recognise and take very seriously. How
prepared are you for events like this? -- and a roll. With whether
particularly we stand up a team that starts looking at the forecast and
assessing whether we should change schedules and make adjustments for
customers and offer them the capability to change bookings and we
did that sometime ago this one and then obviously when it hits, we
figure out what we can do to help. There have been reports from the
United States about some airlines engaging in price gouging, lifting
their prizes for people trying to get out of areas likely to be hit by
the hurricane. How do you react to that? I'm not familiar with those
reports -- prices. If they are not uncomfortable going to these
destinations and they want to delay a month or so, we will do that
without charge. These are difficult events and obviously it would be
great for Virgin Atlantic but that's not the important part, the
important part is for customers to be safe and for us to get our people
and our customers where they need to get to. The chief executive of
Virgin Atlantic. Let's go to Asia now
and the controversy over China's trade imbalance with the US
is likely to be rekindled. China runs a big trade
surplus with the US, in other words it's selling more
to US than it buys from it. The latest figures show that
surplus widened in August. Sharanjit Leyl is following this
for us in Singapore. Give us the figures. That's right,
Rachel. The world's factory seems to be at it again and that massive
trade surplus with the US came in at over $26 billion for the month of
August. That's a rise from the previous month. Essentially taking
the January to August numbers to about $168 billion, a whopping
figure that's unlikely to make President Donald Trump too happy and
it's going to raise trade tensions again I suppose. We know China's
trade numbers for August also posted strong growth so we saw experts
rising about 5.5% in US dollar terms, imports were up 13%. All of
this seems to show China's trade performance seems to be something of
a rebound this year after several lean years, that's really due to
much stronger demand you're seeing at home over there in China as well
as a broad, exports appear to be contributing to China's economic
growth, it's re-establishing its role as the factory to the world and
it's really gone back to a lot of its old ways with its very strong
appetite for industrial commodities, the likes of iron ore and coal,
which is really boosting resource prices worldwide as well. Sharanjit
Leyl, thank you for that. The American credit rating giant
Equifax says its computer systems have been hit by hackers potentially
affecting 143 million The company says the hacking took
place between May and July The hackers stole data
including names, addresses Some British and Canadian accounts
could also have been affected. Let's see how the markets have been
getting on and Asian markets are still currently trading, they are a
bit mixed, there they are, the Hang Seng up, the Nikkei down because the
yen is still strong and the Nikkei is stuffed full of exporters were
the strong yen makes their items more expensive for foreign
companies. Let's look at Wall Street, it held steady yesterday,
not a lot of movement. Waiting to see what happens with the
hurricanes. That's it from me. Don't forget you can get in touch
with me and some of the team