Reinsurance News

April storms drive $2.3 billion economic loss in the U.S.

10th May 2018 - Author: Luke Gallin

Impact Forecasting, the catastrophe risk modelling unit of reinsurance broker Aon Benfield, has reported that severe April storms resulted in combined economic losses of $2.3 billion in the U.S., with approximately $1.5 billion of this covered by re/insurance.

Aon Benfield logoAccording to the firm’s April Global Catastrophe Recap, five separate storm systems caused severe thunderstorms across the U.S. in April, with the strongest impacting the Plains, Midwest, Southeast, Mid-Atlantic, and the Northeast, with almost 70 tornado touch-downs and hail the size of a baseball.

Impact Forecasting reports that the same system also resulted in abnormal snowfall in the Upper Midwest and New England, while major wildfires occurred in the Plains as a result of dry conditions behind the storm.

Overall, the combined economic hit to the U.S. economy from convective storm-related damage in the U.S. in the month of April, were estimated at $2.3 billion, with roughly 65%, or $1.5 billion of this estimated to be covered by re/insurance protection.

Michal Lorinc, an analyst within Impact Forecasting’s Catastrophe Insight team, commented: “As the peak of the severe weather season approaches in the United States, it is worth highlighting the impact of the thunderstorm peril in Europe. As in the U.S., hail has been particularly damaging to European residential and commercial property, as well as vehicles, with several historical events prompting insurance payouts in excess of a billion euros.

Tremor - The modern way to place reinsurance

“Given this risk, Impact Forecasting will soon release a hail model that includes coverage for several European countries, to help our clients better prepare for the potential events.”

Outside of the U.S., intense and persistent flooding in Kenya claimed the lives of at least 78 people in April, as well as causing substantial water damage to homes, crops, and infrastructure.

Local governments in Kenya said the flooding was expected to result in economic losses of $350 million, with $200 million of this alone related to infrastructure.

Flooding was also noted in April across African nations Somalia, Tanzania, Ethiopia, and Rwanda, damaging more than 10,000 homes.

Economic losses of around $1.5 billion is expected in China in April as a result of extended cold and snow which mainly impacted the country’s agricultural sector.

Canadian provinces Ontario and Quebec experienced severe winter weather in April, which Impact Forecasting says is expected to drive an economic loss of $360 million, of which the insurance loss is expected to exceed $180 million.

The Hawaiian Islands experienced torrential rainfall that resulted in widespread flooding, and the state government said it would allocate at least $125 million to flood repairs.

The Fijian Islands were hit by tropical cyclones Josie and Keni in April, with combined damage to physical property, agriculture and infrastructure estimated at over $10 million.

Print Friendly, PDF & Email

Recent Reinsurance News