The earthquake that struck northern California yesterday will lead to economic losses of as much as $4 billion, fueled by damaged wineries and shuttered businesses that rely on tourists.

Insurers will probably cover about $2.1 billion, according to an estimate from Kinetic Analysis Corp., which projected total losses of about twice that sum. Costs borne by the industry may be limited because many homeowners don’t have earthquake coverage, according to the Insurance Information Institute.

“The main source of claims could well be commercial claims, those coming from wineries and vineyards and other commercial interests,” Robert Hartwig, the institute’s president, said in an interview today. “It will take a while for the business owners to sort this out.”

The temblor, the strongest in Northern California in 25 years, hit the Napa region north of San Francisco at about 3:20 a.m. local time yesterday, crumpling historic buildings, cracking roads and injuring more than 120 people. The quake left many in the region without power and water, and California Governor Jerry Brown declared the zone a disaster area.

In Napa, debris and broken glass littered the sidewalks in front of restaurants, wine stores, and antique shops. The city updated the number of buildings “red-tagged” as being uninhabitable to 33, including the Napa Senior Center. PG&E Corp. crews checked about 100 reports of gas leaks and odor and determined that there are no more leaks, according to an update posted to the city’s website late yesterday.

Boutique Hotels

Catastrophe-modeler Eqecat estimated there would be $1 billion of insured losses, with as much as half that figure coming from residential claims. The cost for the industry could climb because of coverage that protects commercial policyholders from lost revenue, Eqecat said. Such losses have fueled higher- than-expected claims from other recent catastrophes including superstorm Sandy in 2012.

The Napa region “is dotted with upscale and luxury boutique hotels, spas and inns,” Eqecat said. “Business interruption losses are a major concern.”

The Napa-Sonoma area is home to one of California’s best- known wine-growing regions. Napa County has 789 licensed wineries which had sales of $5.5 billion in 2011, according to the Napa Valley Vintners Association, a trade group.

“It was a significant earthquake” city manager Mike Parness said in an interview. “Given the magnitude and the reports of damage, this is going to take some time to get back from.”

Landmarks Damaged

The facade on the 113-year-old Goodman Library building, home to the city’s historical society and landmarks commission, collapsed during the quake, sending chunks of concrete onto the sidewalk below. The local post office had a 12-foot crack torn into the corner of the building. PG&E said it restored power to about 53,000 of 70,000 customers whose service failed.

Napa also issued a boil-water advisory, which will be rescinded once all the 60 water lines are repaired and water service has been tested and restored.

In California, where most of the costliest U.S. earthquakes occurred, just 12 percent of residents are protected against that risk, which is excluded from a standard homeowners’ policy, according to III, an industry group. The figure is about half that in the Napa area, Hartwig said,

Residential earthquake coverage provides protection from losses tied to shaking and cracking, while costs tied to fires and water damage from a temblor would be covered under a standard policy. The publicly managed, privately funded California Earthquake Authority is the main provider of the policies in California.

Hurricane Season

The KBW Insurance Index rose 0.8 percent at 10:23 a.m. in New York. Zurich Insurance Group AG, American International Group Inc. and Ace Ltd. are among the companies that sell the most coverage in the region, according to data compiled by Meyer Shields, an analyst at Keefe, Bruyette & Woods.

Even after the quake, insured catastrophe losses are running below normal for this time of year, Hartwig said. Through the end of June, U.S. catastrophe costs were about $9.1 billion. Still, claims are often higher in the third quarter, which is the peak of hurricane season.

“It was the most powerful earthquake I’ve ever felt,” said Dianne Cameron, a 45-year-old Napa resident. “It was lifting the bed off the floor so much that I had to hold onto the mattress so I wouldn’t fall off. It was as if someone picked up the house and started shaking it.”

–With assistance from Nancy Moran and Mary Childs in New York and Alison Vekshin in Napa.