The devastating floods that hit Louisiana in August 2016 are expected to cost the US economy between US$10 billion and US$15 billion according to Aon Benfield’s latest Global Catastrophe Recap report.
Impact Forecasting, Aon Benfield’s catastrophe model development team, today launches the latest edition of its monthly Global Catastrophe Recap report, which evaluates the impact of the natural disaster events that occurred worldwide during August 2016. Aon Benfield is the global reinsurance intermediary and capital advisor of Aon plc.
The report reveals that days of extreme rainfall across parts of the United States Gulf Coast and Midwest caused catastrophic flood damage in several communities during the month, killing at least 13 people.
Total economic losses were forecast at USD10-15 billion, while public and private insured losses were expected to be in the low-digit single billions (USD), due to the regionally low participation in the National Flood Insurance Program (NFIP), which has resulted in more than 80 percent of damaged homes not having flood insurance.
Steve Bowen, Impact Forecasting director and meteorologist, said: “August was an active month for global natural disasters, led by two major catastrophes: historic flooding in Louisiana and a major earthquake in central Italy. While both these events were multi-billion dollar disasters, unfortunately, the vast majority of the losses are likely to be uninsured, further exposing the reality that certain perils remain vastly underinsured regardless of region. Indeed, as we enter the final third of 2016, roughly 75 percent of the year’s disaster losses have been uninsured.”
Belize and Mexico
Hurricane Earl made separate landfalls in Belize and Mexico after first tracking through the Caribbean Sea, killing at least 67 people. According to the report, total economic losses were estimated at USD250 million, including in Mexico (USD132 million) and Belize (USD110 million)
The report also mentions the floods that have affected wide areas of India, where they say the death toll for the season is at least 600, with more than 100,000 homes and other structures destroyed. Total economic losses were estimated at USD462 million.
The floods in Macedonia caused at least $100 million losses and left 3,500 structures damaged.
In Bangladesh, flooding in August damaged 253,413 structures.
The report splits the wave of severe weather and flooding that affected wide areas of China into several separate events which overall cost around $600 million in economic losses.
August was an active month for tropical cyclone activity with several landfalls in the Atlantic and Pacific basins, including Typhoon Nida (Philippines, China, Vietnam), Tropical Storm Dianmu (China, Vietnam), Tropical Storm Mindulle (Japan), and Typhoon Lionrock (Japan, China, Korean Peninsula).
Typhoon Lionrock proved the most costly, causing the deaths of 77 people, damaging at least 20,781 structures, causing economic losses of more than $245 million.
Wildfires and Earthquakes
Other costly disasters for August include wildfires burning in southern France, mainland Portugal, and on the islands of Madeira (Portugal) and La Palma (Spain) which claimed at least five lives. In Portugal alone, the fires charred 115,000 hectares (284,000 acres) of land as total economic damage was listed at EUR200 million (USD226 million).
Major California wildfires prompted evacuations and destroyed hundreds of homes. Economic losses were forecast at above USD100 million; the cost to fight the fires was more than USD50 million alone.
A severe magnitude-6.2 earthquake struck central Italy, killing 296 people and causing catastrophic damage in the hardest-hit towns of Amatrice, Accumoli, Pescara del Tronto, Arquata del Tronto, and Posta.
Total economic damage was estimated to reach into the billions of dollars (USD); however, given very low insurance penetration, the insured loss portion was expected to be a fraction of the overall cost.
Notable earthquake events were also reported in Myanmar and Peru.
Source: AON Benfield. See the full report here.