Tropical storm Ingrid threatens Mexico with rainfall, MultiCat cat bond looks safe

Tropical storm Ingrid, the ninth named storm of the 2013 Atlantic tropical storm and hurricane season, has formed in the far western Gulf of Mexico. Tropical storm Ingrid is expected to head for the Tampico area threatening Mexico with extreme rainfall as it moves forwards.

Interestingly, tropical storm Ingrid is heading directly for the area of the Mexican coastline which is a hurricane parametric trigger zone for the MultiCat Mexico 2012 catastrophe bond. The zone 2 trigger area for the Class B tranche of notes (see a graphic here) covers that exact area of coastline but at this stage it is extremely unlikely that Ingrid could become intense enough to trigger the cat bond.

For the Class B notes to be triggered it requires a hurricane to come ashore in the parametric trigger zone with a minimum central pressure of 920mb or lower. Tropical storm Ingrid currently has a minimum central pressure of around 1000mb and winds of just 45mph and while the storm is expected to intensify, it is unlikely it would get even close to that pressure drop.

For a hurricane to have a minimum central pressure of 920mb you would likely need to see wind speeds in excess of 100mph or even higher. It is extremely unlikely, and the forecasts agree, that Ingrid would intensify that much before landfall.

Tropical storm Ingrid’s main threat to Mexico is going to be extreme levels of rainfall. The forecast suggests that areas along the coast will suffer 10 to 15 inches of rainfall, with some isolated rainfall totals of as much as 25 inches in extreme cases. That is enough to cause flash flooding, landslides and threaten loss of life.

The forecast is for Ingrid to intensify to winds of 65mph before making landfall. Winds that high combined with extreme rainfall could cause some losses and certainly endanger life in the area the storm comes ashore.

Finally, one of the forecast models shows tropical storm Ingrid curving back into the Gulf before making landfall and heading north for Texas. This looks unlikely, no other forecast model agrees, but is worth keeping an eye on over the next two days as Ingrid is currently almost stationary and storms can have a tendency to wobble in terms of direction in the Gulf.

You can see tropical storm Ingrid’s position below and this track will be updated over the weekend. Or track Ingrid on our 2013 Atlantic Hurricane Season page.

Tropical storm Ingrid forecast track