It is expected to cost the insurance industry about $750m and parent Carnival will have to pay a $40m excess.

The company's share price has plunged 370p to £18.78, wiping £3.5bn off its value, as analysts try to estimate how much the disaster would cost the company in terms of repairs and lost earnings.

Rescue workers have yet to access the extent of the damage to the £372m Costa Concordia, which rescue workers are continuing to comb for 29 missing passengers as it lies holed off the coast of Italy.

Experts say it is possible the ship could be salvaged, though, depending on the extent of the damage, it could be declared a write-off. Carnival has already said it will remain out of service at least until the end of its financial year in November.