Natural Disasters in September Bring Costliest Damages to Date for 2018: Aon Report

Hurricane, flood, and earthquake damages made September the costliest month for natural catastrophes in 2018, according to a report from Aon’s Impact Forecasting team.

September is typically the busiest month for tropical cyclone activity around the globe – and 2018 proved to follow that norm with multiple landfalls in the Northern Hemisphere during the month, said the report, titled “Global Catastrophe Recap – September 2018.”

The United States saw two September landfalls: Tropical Storm Gordon and the costlier Hurricane Florence, which made landfall in North Carolina as a Category 1 hurricane. Florence will create more than US$10 billion in economic losses, although insured losses are expected to be in the low-digit billions due to low flood insurance penetration, added Impact Forecasting.

In Japan, Typhoon Jebi caused widespread wind and flood damage, bringing total economic losses that are expected to reach well into the billions of dollars. The General Insurance Association of Japan (GIAJ) said nearly 486,000 insurance claims had been filed, with the expectation of a multi-billion-dollar payout, said the report.

Super Typhoon Mangkhut caused widespread damage in the Philippines, Hong Kong and China as a Category 5 storm, which killed at least 102 people and damaged more than 210,000 homes in the Philippines alone. Total combined economic damage and net loss business interruption was expected to reach into the billions of dollars, while the local insurance industry in China and Hong Kong forecast payouts approaching or exceeding US$1 billion.

Earthquakes

A 7.5 magnitude earthquake and tsunami caused catastrophic damage across Indonesia’s Sulawesi Island on Sept. 28, killing more than 2,000, with many more missing. Total economic damage was expected to approach or exceed US$1 billion.

Another strong earthquake struck the Japanese island of Hokkaido on Sept. 6, killing 41 people and injuring 680 others, said the report quoting the GIAJ, which said that 12,279 insurance claims had been filed.

“September will be recorded as the costliest month so far of 2018, as global economic losses from natural catastrophes are expected to reach into the tens of billions of dollars,” said Steve Bowen, Impact Forecasting director and meteorologist.

“A series of significant catastrophes – including Hurricane Florence, Typhoon Jebi, Typhoon Mangkhut, and the Indonesian earthquake – were poised to cause tens of billions in economic damage. Each of these events were also noteworthy since the majority of losses are likely to be uninsured.”

He said this again highlights the fact that there continue to be gaps in insurance coverage on either a market-wide or individual peril basis in both emerging and developed nations.

“As natural peril risks increase, it becomes even more important to close those gaps to help people in the recovery process,” Bowen added.

Impact Forecasting’s report discussed additional global natural hazard events during the month, which included:

Source: Aon/Impact Forecasting

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