Typhoon Faxai could result in a loss of JPY 300 billion (USD 2.8 billion) for the domestic insurance market in Japan, according to the General Insurance Association of Japan (GIAJ).
At this level, losses would be roughly in line with 2018’s Typhoon Trami, GIAJ’s Chairman, Yasuzo Kanasugi, said at a press briefing on Thursday.
Estimates from catastrophe risk modeller AIR Worldwide currently put the total insurance and reinsurance industry losses from Faxai in the region of $3 billion to $7 billion.
For comparison, Typhoon Trami caused JPY 306.1 billion of losses (US $2.8 billion) for Japanese domestic non-life insurers, with a total industry loss of between $3 billion and $4.5 billion.
Two of Japan’s largest domestic insurers – MS&AD Insurance Group Holdings and Sompo Japan Nipponkoa Insurance – also said earlier this week that they anticipate losses of almost $1 billion each.
Typhoon Faxai hit Japan on September 9th, impacting the Tokyo area with some of the most severe damage seen in the Chiba, Kanagawa and Shizuoka prefectures.
In these areas, more than 900,000 were left without power after high winds downed two electrical towers and multiple utility poles.
As well as damaging winds, the storm resulted in significant storm surge and heavy precipitation to coastal regions.
The GIAJ disclosed that it had received almost 185,000 claims related to Typhoon Faxai so far, although this figure is expected to increase as the full extent of the damage emerges.
Of these claims, more than 161,000 relate to property damage, while almost 20,500 are for damage to vehicles, with the rest coming from accident and other insurance policy claims.
Losses could also be significant for major global re/insurers with a presence in Japan, such as Swiss Re or AIG, given their commercial property operations in the country.
Additionally, it’s anticipated that some of the lower layers of Japanese catastrophe reinsurance programs could be triggered for a second year running, which would likely increase the pressure for upward rate movement at the April renewals next year.