April’s Storms in U.S. Take Toll on Economy, Insurance

May 8, 2014
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April’s outbreak of severe weather and flash flooding in the U.S. will likely be the first billion-dollar economic loss event of 2014 attributed to convective thunderstorms, according to a report by Aon Benfield’s catastrophe model center, Impact Forecasting.

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.

Another U.S. severe weather outbreak led to major damage in parts of the Plains, Midwest and the Mississippi Valley during the month. The most significant damage was attributed 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 Impact Forecasting.

Adam Podlaha, head of Impact Forecasting, said the recent outbreaks have emphasized the importance of historical data analysis for insurers and reinsurers when trying to forecast future losses.

In its monthly Global Catastrophe Recap, Impact Forecasting said that outside the United states, China suffered four separate stretches of severe thunderstorms and heavy rainfall. According to data from the Ministry of Civil Affairs, the events killed nine people and damaged more than 40,000 homes and thousands of hectares of crops. Economic losses were listed at CNY6.2 billion (USD1.0 billion).

Meanwhile, Cyclone Ita made landfall in Australia’s northern Queensland, bringing high winds and heavy rains to mainly rural regions with a low levels of structural exposure. Total economic losses – almost entirely in the agriculture sector – were estimated at up to AUD1.1 billion (USD1.0 billion). The Insurance Council of Australia reported 680 claims with payouts estimated at AUD8.4 million (USD7.9 million).

Torrential rains from a tropical disturbance that would later become Cyclone Ita led to extensive flooding in the Solomon Islands’ capital Honiara. At least 23 people were killed and a state of emergency declared after the rains caused the Matanikau River to burst its banks, affecting more than 50,000 residents.

A powerful magnitude-8.2 earthquake struck off the northern coast of Chile, causing damage and spawning a small tsunami. Seven people were killed and 13,000 homes damaged in the towns of Iquique and Alto Hospicio. Total economic losses were expected to be less than CLP55 billion (USD100 million).

Additional earthquake events occurred in Nicaragua, Mexico, and China during the month.

Torrential rains fell across northern Afghanistan, leading to extensive flash flooding and landslides in 10 provinces. An estimated 2,665 people were killed, including 2,500 in a massive landslide in Badakhshan province. Damage was also noted in the provinces of Jowzjan, Faryab, Sar-e Pol and Baghdis, where 70,000 people were left homeless.

Heavy rains and a melting snowpack led to flooding in parts of Romania, Serbia and Bulgaria, killing at least four people. Each country declared a state of emergency for the hardest-hit districts and municipalities as several rivers overflowed their banks. Damage estimates to infrastructure and property were listed in excess of USD10 million.

A large wildfire impacted multiple neighborhoods in the Chilean city of Valparaiso, killing at least 15 people. A citywide state of emergency was declared as the fire destroyed at least 2,900 homes. Total damage and aid costs were listed at CLP18.7 billion (USD34 million).

Source: Impact Forecasting

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Latest Comments

  • May 8, 2014 at 2:05 pm
    Agent says:
    I wonder what the economic toll was from the EPA and their overbearing regulations.
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