Tag Archives: Impact Forecasting

Property losses from severe convective storms spark focus on resilience

More than $14 billion. That’s the expected insured loss from severe convective storms, thunderstorms, tornadoes, large hail and associated damaging winds in the United States in the first six months of this year.

From the Artemis blog, via Impact Forecasting, the catastrophe risk modeling center at Aon Benfield:

“The insurance and reinsurance industry faces more than $14 billion of losses after the first-half severe storm activity in the U.S., while the economic loss is set for $22 billion or higher, putting 2017 as the fourth most costly year for both economic and insured losses due to convective weather activity.”

Check out the U.S. tornado count, 2017 from NOAA:

An important message on building resilience from Munich Re, as reported by Business Insurance:

“Munich Reinsurance America Inc. has released a tornado virtual reality experience tool to highlight the risks posed by tornadoes and the importance of embracing resiliency in building construction to help reduce future property losses.”

And:

Many building codes in the United States do not require a home to withstand more than a 90-mph gust of wind for three seconds, which is the equivalent of a weak EF1 tornado with wind speeds between 86 to 110 miles per hour.

Get Insurance Information Institute facts and statistics on tornadoes and thunderstorms here.

Get serious about the lightning threat from the Insuring Florida blog.

 

May severe weather: multi-billion dollar insurance payout aids recovery

Severe weather across the United States in May resulted in combined public and private insured losses of at least $3 billion.

Aon Benfield’s latest Global Catastrophe Recap report reveals that central and eastern parts of the U.S. saw extensive damage from large hail, straight-line winds, tornadoes and isolated flash flooding during last month’s storms.

The most prolific event? A May 8 major storm in the greater Denver, Colorado metro region, where damage from softball-sized hail resulted in an insured loss of more than $1.4 billion in the state alone.

Check out I.I.I. facts and statistics on hail here. The National Weather Service has detailed information on severe storm events, including hail, tornadoes and wind. 2016 data on the number of hail events are posted online.

Total aggregated economic losses from U.S. severe weather in May were in excess of $4 billion, Aon Benfield said.

U.S. Thunderstorm Losses Add Up To Q1 Record

Topping $5.7 billion. That’s the record cost of insured losses from severe thunderstorms and convective weather in the United States in the first quarter of 2017.

The latest figures come via Steve Bowen, director and meteorologist at Impact Forecasting, the catastrophe risk modeling center at Aon Benfield.

Here’s the chart (via @SteveBowenWx):

Artemis blog offers this perspective:

“It’s the second year in succession that insurance and reinsurance markets have faced a heavy toll from severe thunderstorm related losses, which in turn means impacts to ILS [insurance-linked securities] funds and investors, as severe convective storm risk is a typical peril of many catastrophe reinsurance arrangements that ILS investments are linked to.

Beyond the first-quarter the expensive run-rate of losses from severe thunderstorms has continued, with some further outbreaks in the last fortnight.”

A recent Willis Re study found thunderstorms were just as costly to insurers as hurricanes.

Check out these resources (here and here) from the Insurance Institute for Business & Home Safety on how to protect your home and business from thunderstorms and tornadoes.

Register here for an April 27 Swiss Re and I.I.I. webinar on natural catastrophes.

I.I.I. facts and statistics on tornadoes and thunderstorms here.

June Flood Losses Highlight Insurance Protection Gap

The economic cost of flood losses worldwide in June will exceed $5 billion, though the insured loss portion will be significantly less, according to Aon Benfield’s latest Global Catastrophe Recap.

Impact Forecasting, the cat modeling center of Aon Benfield, reports that major June floods highlighted by China and U.S. events, saw the global economic toll mount.

Seasonal “Mei-Yu” monsoon rains led to multiple rounds of significant flooding across central and southern parts of China throughout June, resulting in more than 130 fatalities.

The most damaging floods occurred in the Yangtze River basin as rivers and tributaries overflowed their banks and minimally inundated 200,000 homes. Beyond property damage, there were substantial impacts to the agricultural sector.

Impact Forecasting said:

“Total aggregated economic losses were estimated by the Ministry of Civil Affairs at upwards of CNY29 billion (USD4.4 billion). Given low penetration levels, the insured loss portion was only a small fraction of the overall damage cost.”

Exceptional rainfall in the U.S. state of West Virginia also led to catastrophic flooding in several counties. The federal government declared a disaster after major damage occurred in Clay, Fayette, Greenbrier, Kanawha, Monroe, Nicholas, Roane, and Summers counties, As many as 5,500 homes and 125 businesses were damaged or destroyed.

“Total economic losses were anticipated to reach into the hundreds of millions of dollars. The insured loss portion of the loss was expected to be less given rather low up-take in the National Flood Insurance Program (NFIP).”

Additional major flood events in the month of June occurred in India, Indonesia, Myanmar, and Ghana, according to the report.

The gap between economic and insured losses for both major flood events in China and the U.S. illustrates the need for greater insurance penetration around the globe.

A 2015 Swiss Re report estimated the current annual disaster protection gap between insured and total losses at around $153 billion, assuming an average catastrophe loss year.

In absolute terms, the U.S., Japan and China account for more than half that amount, with a combined annual shortfall of $81 billion, Swiss Re said.

A 2015 poll by the Insurance Information Institute found that 14 percent of American homeowners had a flood insurance policy. This percentage has been at about the same level every year since 2009.

May Thunderstorm Events: $2 Billion+ Insured Losses

Multiple outbreaks of severe weather led to a costly month for insurers in the United States in May,  as thunderstorm events continued to dominate the catastrophe record.

According to the latest Global Catastrophe Recap report by Aon Benfield’s Impact Forecasting, no fewer than four stretches of severe weather affected the U.S. during the month of May.

Aggregate insured losses exceeded $2.2 billion and overall economic losses were at least $3.5 billion, with large hail and damaging winds the primary driver of the thunderstorm-related costs, Impact Forecasting reports.

The costliest stretch occurred during a five-day period (May 18-23) which saw damage incurred in parts of the Midwest, Plains, Rockies, Mid-Atlantic and the Northeast, including the major metropolitan areas of Chicago, IL and Denver, CO.

According to Impact Forecasting’s report, baseball-sized hail and straight-line winds gusting in excess of 70 mph (110 kph) were recorded that severely affected residential, commercial and auto interests. Total economic losses were estimated at $2.5 billion, with insurers reporting losses minimally at $1.5 billion.

Meanwhile, the combination of excessive heat, extreme drought conditions, low relative humidity and gusty winds led to dozens of wildfires across parts of the Texas Panhandle and Southern California, leaving two dead.

Overall fire costs/damages from the two states approached $100 million, according to Impact Forecasting.

In Texas the most significant fire was in Hutchinson Country, where at least 225 homes and 143 unoccupied structures were damaged or destroyed.

In California, at least 14 fires were ignited in the greater San Diego metropolitan region, including the Poinsettia Fire that destroyed eight homes, an 18-unit condominium complex, and two commercial buildings.

The report adds that through the end of May, tornado activity in the U.S. remained in the bottom 25th percentile of all years dating to the early 1950s.

Check out I.I.I. facts and statistics on thunderstorms.

Economic Impact of April Thunderstorms

If you haven’t read it already, the April edition of the Global Catastrophe Recap Report by Aon Benfield’s Impact Forecasting puts some numbers around the thunderstorm events that devastated parts of the United States last month.

According to the report, severe weather and flash flooding that caused extensive damage across more than 20 states in April will likely be the first billion-dollar economic loss event of 2014 attributed to convective thunderstorms.

At least 39 people were killed and 250 injured amid nearly 70 confirmed tornado touch-downs, which occurred across more than 20 states in the Plains, Mississippi Valley, Southeast, Midwest, and Mid-Atlantic.

Economic losses are set to exceed $1 billion, with insured losses minimally in the hundreds of millions of dollars, Impact Forecasting reports.

Another U.S. severe weather outbreak in April led to major damage in parts of the Plains, Midwest and the Mississippi Valley. The most significant damage was due to hail, as hailstones the size of softballs struck the Denton, Texas metro region.

Total economic losses were estimated at $950 million, with insured losses in excess of $650 million, according to the report.

In a press release Adama Podlaha, head of Impact Forecasting, says:

The recent outbreaks of tornadoes, large hail and damaging straight-line winds in the United States have emphasized the importance of historical data analysis for insurers and reinsurers when trying to forecast future losses.†

If you’re wondering how many convective thunderstorm events made the list of significant natural catastrophes in 2013, take a look at this slide from a presentation made by I.I.I. president Dr. Robert Hartwig at the National Tornado Summit in February.

It shows that thunderstorms accounted for  six of the  nine significant natural catastrophe events with $1 billion economic loss and/or 50 fatalities in 2013.