Briefing - Bird flu: why you should be worried.

(From Reinsurance)

Although the 9/11 terrorist attack completely restructured the global insurance industry, the impact of a flu pandemic has not been tested yet, leaving the consequences to speculation.

Theories aside, the H5N1 virus has now moved out of Asia and is rapidly marching south and west. Scientists are closely monitoring the latest outbreaks in Europe and Africa in a bid to raise the alarm should the H5N1 virus leap out of its present mode of transmitting via birds to become transmissible between humans - the first step toward a pandemic.

Estimates vary as to the human cost of a flu pandemic, with one UN official speculating that it could cause the deaths of up to 150 million people. Most experts have adopted the World Health Organisation (WHO)'s prediction of 2-7.4 million deaths worldwide if the H5N1 strain mutates. In the UK, the Cabinet Office estimated in late 2005 that 600 000 people (or 1% or the UK population) could die.

These high-end numbers reflect the worst-case and not the most likely scenario, believes Cara New, chemical, biological, radioactive and nuclear expert at Exclusive Analysis.

A deadly strain

Ms New stresses that although bird flu has infected humans throughout history, the H5N1 strain appears to be the most dangerous. "It can cause severe disease in humans; it mutates rapidly; and it can also mix with influenza viruses that infect other animal species," she says. Ms New warns the insurance industry to be aware of the virus' potential impact on the poultry and pork industry, as well as the horse-racing industry. She points to an outbreak in China in 1989 where an avian flu virus infected horses, killing 20% of the infected animals.