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Insurance ETFs Fall as Hurricane Irene Looms

tlydon@globaltrend.com (Tom Lydon)

Exchange traded funds tracking the insurance sector fell Thursday as the East Coast braced for Hurricane Irene.

The “potentially devastating” Category 3 storm is expected to carve a path along the coast and reach the Northeast this weekend.

New York Mayor Michael Bloomberg on Thursday warned residents to be prepared to evacuate.

Shares of insurers Alltate (NYSE: ALL - News) and Chubb (NYSE: CB - News) were down 3% on Thursday.

Insurers could be facing trillions of dollars in losses as Hurricane Irene moves north towards New York, TheStreet reported Thursday. New York has over $2.3 trillion of insured coastal property, according to the report.

“The hurricane is an excuse not to be buying the property and casualty insurers,”  Guy LeBas, chief fixed-income strategist at Janney Montgomery Scott, told Bloomberg . “Fundamentally speaking, these names are prepared for reasonable damages.”

ETFs that invest in the insurance sector include:

  • SPDR KBW Insurance (NYSEArca: KIE - News )
  • iShares Dow Jones U.S. Insurance (NYSEArca: IAK - News )
  • PowerShares Dynamic Insurance (NYSEArca: PIC - News )

SPDR KBW Insurance

Max Chen contributed to this article.