Repair Costs in Southeastern U.S. Remain 20% to 40% Above Average As 2005 Hurricane Season Begins

NEWARK, Calif., June 1 /PRNewswire/ — Risk Management Solutions (RMS), the world’s leading provider of products and services for the management of catastrophe risk, announced that elevated labor and material costs resulting from last year’s hurricanes are likely to continue through the 2005 season, which commences today. In this environment even a modest event could trigger further demand surge, escalating insured and economic losses, particularly in the southeastern U.S.”Although construction material costs are up 5%-10% nationwide, the increase in labor costs has outpaced this by a significant margin in Florida and Alabama,” stated Phil LeGrone, claims research director for RMS. “Due to the sustained escalation of labor costs in these states, if a hurricane makes landfall in the southeastern U.S. this year, its economic impact will be as if it were the fifth event in the 2004 season.”….

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