Tuesday, November 12, 2013
Amid the pictures and stories of destruction from Typhoon Haiyan come some facts that put the damage from this storm in perspective, at least in insurance terms.
Typhoon Haiyan hit the central Philippines as an extreme Category 5 storm, with winds of 195 miles per hour as well asÂ a massive storm surge on November 8. It then traveled across the South China Sea and made landfall on the north Vietnam coast as a Category 1 storm with 75 mile per hour winds on November 10.
Latest media reports put the death toll in the city of Tacloban alone at more than 10,000. While this figure seems high, the Capital Weather Gang blog notes that even if the death toll estimate holds up Haiyan would rank outside the top 35 deadliest tropical cyclones on record.
For comparison, the most deadly tropical cyclone on record was the Great Bhola Cyclone that claimed 300,000-500,000 lives in Bangladesh in November 1970.
According to Swiss Re sigma statistics, Haiyan may also fall outside the top 25 worst catastrophes in terms of victims (1970-2012).
Insurance industry experts predict that while the economic impact of Typhoon Haiyan will be significant, insured losses are likely to be low.
AIR Worldwide reports that the economic cost of the typhoon is expected to be the highest from a natural disaster in the Philippinesâ€™ history, although only a small portion of it is expected to be insured.
Officials suggest more than two million families (nearly 10 million people) have been affected by Haiyan in the Philippines, with more than 650,000 people displaced, AIR Worldwide adds.
Dr. Robert Hartwig, president of the Insurance Information Institute (I.I.I.) notes that the Philippines is a very small market for property/casualty insurance, with premiums written in 2012 of just $1.23 billion. On a per capita basis, this works out to just $12.70, compared with $1,223.90 in the United States.
Another reason why insured losses may be nominal, Dr. Hartwig says, is that the storm did not make a direct hit on Manila, the capital and largest city in the Philippines.
The I.I.I. reports that prior to Haiyan, the strongest storm to hit this region was Super Typhoon Megi in October 2010, which impacted the Luzon region. Insured losses for that storm were estimated at less than $150 million.
Check out this satellite image of Haiyan, as it moved over the central Philippines November 8,Â courtesy of NASA: