Insurance and Climate Change column

Alaska Wary of ‘California Style’ Blackouts; Study Assesses Global Hailstorm Trends

By | April 1, 2021

Alaska could face “California-style” blackouts as climate change increases the state’s wildfire risk.

That’s according to an article this week in the Anchorage Daily News.

The article centers on Alaska’s record-breaking 2019 wildfire season and the McKinley Fire, believed to have been started by a fallen treen, which destroyed 52 homes, three businesses and 84 other structures.

A group of insurers sued Matanuska Electric Association for more than $2.7 million to try and recoup claims costs, even though investigators concluded the tree didn’t come from the utility.

Now the state’s electric utilities are asking the state Legislature to help, saying if they can be held liable for wildfires started by trees outside their property, the cost could bankrupt them. They have may have learned a lesson from PG&E, which may be turning off power for Californians more often as it is again facing potential liability for that September California fire came a few months after it emerged from a 17-month stint in bankruptcy that was triggered by its responsibility for a series of wildfires in 2017 and 2018.

The Alaskan utilities have proposed legislation that would shield them from some of these wildfire-related lawsuits, without which they could be forced to start California-style rolling blackouts during wildfire conditions, the paper reported.

Hail

Hail severity may increase in most regions of the world as a result of climate change, according to a recent study published by the journal Nature.

A review study published by researchers from University of Bern, Central Michigan University, Karlsruhe Institute of Technology, University of Illinois, Colorado State University and Peking University, in Nature Reviews Earth & Environment examined the future effects of climate change on hail. The study includes global summary of hail trends from past observations and projected future trends from simulations and models, which led to “the general expectation that hailstorm frequency will decrease in East Asia and North America, while increasing in Australia and Europe, and that hailstorm severity will increase in most regions,” the Newswise report states.

The researchers said current and future climate change effects on hailstorms remain highly uncertain, in part due to a lack of long-term observations and limited modelling studies, even in Australia, where indications are that hailstorms will increase.

“There’s very high uncertainty when it comes to these predictions and Australia is particularly of high uncertainty because there are very few studies that have actually looked at Australia,” said lead author and a researcher at UNSW Sydney’s Climate Change Research Centre Tim Raupach. “We need to do further study to find out exactly what we expect to happen, not only in Australia but across the world.”

Swiss Re

Natural and manmade catastrophes cost the insurance industry $89 billion in 2020, in the fifth costliest year since 1970, and of that total, most ($81 billion) was related to claims from natural catastrophes, according to a report from Swiss Re’s sigma.

The Swiss Re report, which was reported on this week by Insurance Journal’s Lisa Howard, shows there were 189 natural peril and 85 man-made disasters during 2020.

Global economic losses in 2020 from these disasters were $202 billion, up from $150 billion the year prior, according to the report.

Losses from primary and secondary perils have been on the way up since 1970, which are both affected by the same risk trends, including rapid population growth, increasing property values in exposed regions, and the effects of climate change.

As a result, future peak loss scenarios for both hurricane season and multiple secondary peril events could reach between $250 billion and $300 billion, with a warning that it is just a matter of time before such a severe scenario plays out in reality.

Tropical Cyclones

Researchers at Princeton University, the U.S. National Oceanic and Atmospheric Administration, and the University of East Anglia found growing evidence that climate change is probably fueling more powerful hurricanes and typhoons, a trend that may continue as global temperatures rise.

The researchers examined more than 90 peer-reviewed articles to assess whether human activity is influencing tropical cyclones, including tropical storms, hurricanes and typhoons, the ScienceBrief News reported this week.

The researchers say to expect a roughly 5% increase in maximum wind speeds if the planet warms by 2 degrees Celsius.

“There is moderate consensus that climate change is already playing a role in the development of tropical cyclones, but it is early days,” Prof Corinne Le Quéré, Royal Society professor at UEA’s School of Environmental Sciences, said in ScienceBrief Review. “In comparison with wildfires, the consensus is already clear that climate change increases the risks, as shown earlier on ScienceBrief Review.”

Climate model projections suggest that with further warming in coming decades will yield a larger proportion of Category 4 and 5 tropical cyclones globally, with more damaging wind speeds and more extreme rainfall rates, according to ScienceBrief.

Past columns:

Topics California Catastrophe Natural Disasters Trends Alaska

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