Highest Paid Insurance Claims of All Time

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Large life insurance payouts generally mean getting facts about a large scale event of devastation. As unfortunate as terrorist attacks, natural disasters, and the death of beloved celebrities are, there is comfort in knowing that insurance companies are paying their obligations. Sometimes, the insurance payouts are astronomical. Six of the highest paid life insurance policies of all time are:

1.    Michael Jackson’s Death in 2009

The King of Pop died unexpectedly at the age of 50 in 2009, leaving behind three young children who would need to be cared for in the wake of their father’s untimely death. Michael Jackson was insured for $20 million under a personal life insurance plan, which was whittled down to a settlement of $3 million to his estate, in the shadows surrounding his exact cause of death. AEG Live, Jacksons concert promoter,  initially filed a lawsuit  to claim $17.5 million dollars in life insurance after Jackson’s death but later dropped the lawsuit.

2.  Dale Earnhardt’s Death in 2001

The racing legend died in a racing crash in 2001 and the racing world reeled over it. Because of the nature of his job, Earnhardt had a team life insurance policy, which ensures insurance payouts to the racer’s team in the event of a team member’s death. The insurance company paid out $3.7 million on the policy.

3.  Hurricane Katrina from 2005

Hurricane Katrina barreled through the Gulf Coast in 2005 and had reverberating effects that are still felt today. The storm began at sea at a moderate Category 1 and had strengthened to Category 5 by the time it caused major devastation in the coastal states down south. The United States government struggled to facilitate the disaster recovery process and took on much criticism in the process. Almost 2,000 people lost their lives in the natural disaster. The insurance payouts for Hurricane Katrina were estimated to have been $45 billion.

4.  Japanese Earthquake and Tsunami from 2011

The earthquake that rocked Japan and caused a tsunami that was reported to be more dangerous than the tremors of the earthquake that caused them will go down in history as one of the worst disasters in the world. Exacerbating the circumstances was the nuclear disaster that came along with the natural events that measured the earthquake at 9.0; effectively incapacitating the region while the extent of nuclear repercussions is still being measured. Three nuclear reactors were damaged in the disaster and there is still a high amount of radiation present in the affected areas. The costs of this event are currently ongoing, but so far, payouts are estimated to be $25 billion.

5.  San Francisco Earthquake of 1906

This natural disaster that took place in April of 1906 occurred even before scientists had begun to rate earthquakes on the Richter scale. According to modern measurements and descriptions and studies of the damage done, the earthquake of 1906 is estimated to have been a 7.9 on the severity scale. The resulting catastrophe was devastating to the town of San Francisco and the surrounding areas and there were more deaths during the hurricane and the subsequent fires than was reported by the city’s leaders. Not only were more than an estimated 3,000 lives lost in China Town alone, the death toll in the rest of San Francisco was downplayed and reflected a low number just over 300. Over $225 million in claims are paid out causing some insurance companies to go out of business completely. The $400 million in damages would translate to $8.9 trillion in 2007 dollars.

6. September 11, 2001, Terrorist Attack Victims

The toll in human life and devastation enacted by the terrorist attacks in New York City on September 11, 2001, was almost immeasurable. Unsuspecting citizens across the country were hit with the attacks at a time when most people were at work and an estimated 2,551 people lost their lives. The amount of insurance payouts to victims’ families are just over $38 billion, with half of that figure having been paid from insurance companies. The total cost of the terrorist attacks, including the loss of jobs and property, has been estimated to be $2 trillion.

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