2015 Global Insured Losses Lowest Since 2009 Despite El Niño Effects: Carpenter

March 25, 2016

One of the strongest El Niño periods on record and a positive phase of the North Atlantic Oscillation were the climate drivers in 2015 that led to an exceptional season of Pacific tropical storms and severe windstorms and flooding in Europe, according to a report published by Guy Carpenter & Co.

Nevertheless, 2015 was a quiet year in terms of global insured losses, which totaled around $30.5 billion, said the report titled “Global Catastrophe Review – 2015.”

Insured losses for 2015 were below the 10-year and 5-year moving averages of around $49.7 billion and $62.6 billion, respectively. Last year also marked the lowest total insured catastrophe losses since 2009 and well below the $126 billion seen in 2011, Carpenter added.

The most destructive and deadliest catastrophic event of 2015 came in the form of the powerful magnitude 7.8 earthquake that struck Nepal in April. This event saw a tragic loss of life around 9,000 with millions more affected, including 500,000 people rendered homeless. Then in September a magnitude 8.3 earthquake struck near Illapel, Chile, causing estimated insured losses ranging from $600 million to $900 million.

El Niño’s Impact

Characterized by warm waters in the tropical east Pacific, the strong El Niño seen in 2015 was associated with record-setting tropical cyclone activity in the North Pacific basin, but relatively quiet activity in the North Atlantic, the report said.

Heavy Pacific typhoon activity affected mainland China, Japan, the Philippines and Taiwan, while Mexico saw landfall of Hurricane Patricia, the strongest hurricane observed in the Western Hemisphere. In total, the 2015 tropical season produced 27 major hurricanes, surpassing the previous record of 21 major hurricanes seen in 1992.

“The onset of such a strong El Niño significantly influenced the record-setting activity seen in the 2015 tropical season,” said James Waller, PhD, Research Meteorologist for GC Analytics.

“As with typical El Niño years, wind shear was elevated in the Atlantic basin and even reached record levels in 2015. The tropical Atlantic basin saw 11 named storms in 2015, while the tropical North Pacific basin saw the most active season in the historical record, surpassing the exceptional 1992 season,” Waller added.

Effects of North Atlantic Oscillation (NAO)

The positive NAO phase, such as observed in the 2014/2015 winter season, is often associated with increased storm transits and greater storm severity, said the report. Last year proved to be no exception with windstorms Elon and Felix, which hit Northern Europe in early January, while floods affected central Italy in early March.

The most significant events were Storms Mike and Niklas, which swept through western and central Europe at the end of March. Storm Mike caused downed trees and transportation disruption, with a reported gust of 151 kilometers per hour (92 mph).

Storm Niklas brought high winds and heavy rains to much of Northern Europe, with a wind speed of 190 kilometers per hour (116 mph) observed at Germany’s highest mountain. The storm also brought significant transportation disruption for air, rail and land. Guy Carpenter reports that winter Storm Niklas produced estimated insured losses of $1.0 billion.

Man-Made Catastrophes

Beyond natural catastrophes in 2015, there were also significant man-made catastrophic events, including the Port of Tianjin explosions in August, which had estimated insured losses of between $1.6 billion and $3.3 billion, according to Guy Carpenter.

Significant events also affected the oil and aviation sectors, including the loss of the TransAsia flight over Taiwan and the downing of a Russian MetroJet over Egypt with 224 dead. The year of 2015 also saw the coordinated terror attacks in France which resulted in at least 130 fatalities.

Source: Guy Carpenter


Topics Catastrophe Profit Loss Europe Hurricane

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