Key facts
- Verisk estimates economic losses from the Venezuelan earthquakes will exceed $10 billion.
- The earthquakes occurred on June 24 near densely populated areas.
- Damage was most severe in the Caracas metropolitan region and La Guaira.
- An estimated 1,400 buildings were destroyed.
- Factors contributing to uncertainty in insured loss estimates include macroeconomic conditions, high inflation, and low insurance penetration.
Catastrophe and risk modeling firm Verisk has estimated that economic losses from the earthquakes that struck Venezuela on June 24 will exceed $10 billion. The seismic event, described as a rare double earthquake with a 7.2 magnitude foreshock followed by a 7.5 magnitude mainshock, was the strongest to hit the region since 1900. Significant damage was reported in the Caracas metropolitan region and the coastal state of La Guaira, where approximately 1,400 buildings were destroyed. Verisk noted that estimating insured losses carries a higher degree of uncertainty than usual, attributing this to Venezuela's challenging macroeconomic conditions, including elevated inflation, low insurance penetration, and market complexities related to sanctions. The country's already fragile economy, crippled by years of sanctions, corruption, and mismanagement, faces further strain from this disaster. Infrastructure, including hospitals and essential services, is ill-equipped to handle such a crisis, exacerbating the humanitarian emergency. Early modeling from the US Geological Survey suggested potential economic losses ranging from $10 billion to $100 billion, with the upper figure being comparable to Venezuela's entire economy.