On Friday evening, as the crowds in London's City bars started to spill into the streets, its sister financial district in Manhattan was covered in 10cm of ash and dust. Debris was piled ten storeys deep around what remained of the World Trade Centre (WTC). Large parts of the area were without electricity, gas, telecommunications and water. The attack on the centre badly damaged energy company Con Edison's substations and major electric transmission cables. About 140 Con Edison repair crews were in the devastated area, working alongside the emergency services.

Verizon Communications, which handles most of the local communications in lower Manhattan, had a major switching service adjacent to the centre. It was left with “three or four major holes”, Verizon president Larry Babbio said. “That means water and dirt have got into sensitive computer gear.” Babbio's staff were working to bypass the service so lines were ready for the opening of Wall Street on Monday.

Subway services running through the financial district were closed – two rail lines for the coming weeks and two possibly for years. Air conditioning systems were clogged by dust and dirt, creating serious health risks. Other buildings were sodden after the shock of the centre collapsing set off their sprinkler systems. No businesses were open below 14th Street. Even when basic services are functioning again, the business interruption (BI) cost to property insurers will be phenomenal, with experts estimating the damage to reach between $2bn (£1.36bn) and $5bn (£3.4bn).

No sufficient cover
Fortune Consulting International's Larry Kalmis is a US-based fellow of the Business Continuity Institute. He said it was unlikely any of the companies that have been hit would have had business continuity plans sufficient for the scale of the disaster.

“I don't think there's a plan around that would cover these specific scenarios,” Kalmis said. “For single-office businesses, it could be weeks, months or maybe never, before they open again.”

He said many of those that did have plans were unable to carry them out because they involved transporting staff by air to alternative sites or using alternative premises that were close to the disaster area.

Other companies will find the BI cover was insufficient for the magnitude of the disaster. Fox-Pitt Kelton insurance analyst William Hawkins said the 1993 terrorist attack on the centre cost $510m (£346.8m), mainly in BI losses, so costs of up to $5bn (£3.4bn) this time are feasible. “From an event that did relatively little damage we had half a billion losses, so it's clearly going to be north of that. But how much is impossible to tell,” he said.

Hawkins said the high-calibre companies based in New York's financial district were likely to have BI clauses in their property cover. However, he said not all BI policies covered economic loss for, for example, businesses in the vicinity that were not physically damaged but had no trade as a result.

Hawkins said this also depended on what period of indemnity the cover gave – usually set at 12, 18 or 24 months – and how long the disruption continued. “Insured losses will be much less than the true loss,” he said.

He said property insurers AIG and Chubb, with a large presence in the US market, would take the greatest hit from BI claims. On Monday, AIG said a “preliminary estimate” of its loss would be $500m (£341m), through a variety of coverages rather than a large exposure to the centre's property insurance. He said Royal & SunAlliance (R&SA) was the only UK company likely to have US property exposure. This has been confirmed by R&SA, which estimated its loss at £150m.

By the end of last week, some damaged companies were already working on recovery. JLT director Dominic Collins, who has been placing US property risks in the London Market for more than 25 years, received business interruption claims from clients within two days of the attack.

“One client had a retail location in the basement of the World Trade Centre, but they've made a business interruption claim for their whole retail operation in Manhattan – 23 shops – presumably because most of the stores are closed,” Collins said.

Behind the scenes
Loss adjusters are already working on claims. GAB Robins' London director, James Peace, said even if loss adjusters were not immediately allowed onto the disaster site, there was plenty of behind-the-scenes work to be done.

“They can offer support and assistance at a difficult time, there's a lot they can do as a steadying hand. Advice can be given on temporary and alternative facilities, on what the policy will cover, on whether to go ahead with additional equipment,” he said.

Once they are permitted close to the centre, loss adjusters will begin disaster assessment. If nothing physical remains of the commercial premises, they will sift through inventories and company records to ascertain the scale of tangible losses.

UK-based loss adjusters have already made preparations to send back-up staff to the US. McLarens Toplis' international business direc-tor Alex Gargolinski said the company had more than 30 senior UK loss adjusters ready to travel.

“We're making ready under instructions from our American colleagues,” he said. “It's their call as to when they want us to respond.”

Crawford & Company has formed a UK catastrophe response team in readiness and GAB Robins has got a team on stand-by. Only Ashworth Mairs is unlikely to be affected. Partner Paul Greenaway said the company was in the midst of applying for a US loss adjusting licence when the disaster struck. “Little did we know this would happen or we might have been a little more hasty,” he said.