By Mariko Sanchanta
Industry efforts have been hampered by the difficulty of assessing the scale of the damage, said Jose Hernandez , chief executive of the unit's Chartis Far East Holdings arm, which covers Japan and South Korea. The March 11 earthquake and ensuing tsunami killed more than 12,000 people as of the most recent count and left more than 200,000 people living in shelters.
"We've dealt with earthquakes, we've dealt with typhoons, but dealing with an earthquake and a tsunami back to back is unprecedented," Mr. Hernandez said.
The insurer stressed, however, that claims would be processed more quickly in the near future, as it turns to alternative ways of assessing damage, including using Apple /zigman2/quotes/202934861/composite AAPL +2.62% Inc.'s iPads equipped with cameras.
Mr. Hernandez said the iPads helped Chartis conduct as many as 30 surveys in a day, more than twice the number as earlier. Instead of engineers and surveyors going to the sites, inspectors can show the specialists information and images remotely.
The cost to the industry is expected to be enormous. Insurance companies world-wide could face losses of between $20 billion and $30 billion as a result of Japan's earthquake and tsunami, Boston-based risk-modeling agency AIR Worldwide said late last month.
AIG, the oldest and largest foreign insurer by direct premiums operating in Japan, has estimated its property-and-casualty business would have to pay $700 million in claims, on top of the $500 million in catastrophe reserves its Japanese operations earlier established for earthquake damage to people's homes.
Chartis said that it has received about 31,000 claims calls, and has paid about 6% of its total claims outstanding as of Monday. Mr. Hernandez declined to disclose the total value of the claims.
Tokio Marine Holdings /zigman2/quotes/210254144/delayed JP:8766 -0.66% Inc., Japan's largest nonlife insurer by market capitalization, said the company has received about 80,000 claims since the quake. Japan's third largest, NKSJ Holdings /zigman2/quotes/201620552/delayed JP:8630 +0.44% Inc. received about 85,000 claims as of March 28. Neither company has released information on how many claims have been paid since the earthquake.
Mr. Hernandez said that small-business owners, in particular, were going to be hard hit by the natural disaster. "Small-business owners are a big concern for us. They are a big segment of the market we go after in Japan. If we get the small enterprises in Japan back on their feet, that's the best effort we can do in getting the economy back on its feet."
At AIU Insurance Co., one of four insurance businesses in Japan under the umbrella of parent Chartis, more than 50% of its policyholders are small and mid-size business owners. For Chartis overall in Japan, about 30% to 35% of its business is tied to small and mid-size companies, according to Mr. Hernandez.
Nonlife insurers in quake-prone Japan offer earthquake insurance as a part of fire-insurance policies, and demand for this type of insurance has increased over the past decade.
Atsuko Fukase contributed to this article.
Write to Mariko Sanchanta at firstname.lastname@example.org