Another outbreak of severe thunderstorms and convective weather resulting in numerous tornado, hail and strong wind reports across the central U.S., and European windstorm Zeus which slammed into France causing widespread impacts are likely to drive insured losses this week.
Both events may have ramifications for reinsurance and ILS capital sources, as U.S. tornado and severe thunderstorm losses continue to aggregate in 2017 and European windstorm losses from the season look set to rise further.
Aon Benfield’s Impact Forecasting unit said that the severe convective storm outbreak across the central U.S. on March 6th and 7th will result in hundreds of millions of dollars of losses and if added to the previous major U.S. tornado outbreak will give a combined insurance market loss of over $1 billion.
After the last outbreak total 2017 insurance and reinsurance losses from severe thunderstorms, tornadoes, hail and straight line winds due to convective weather were heading for $2 billion. After this week it seems likely they will have passed that point.
Severe weather struck parts of Missouri, Iowa, Minnesota, Kansas, Arkansas, Oklahoma, and Illinois on March 6th and 7th, leaving a trail of damage across the same region impacted just a week earlier by tornadoes. Additionally, a major synoptic wind event on March 8th and 9th caused widespread power outages in the Midwest and Northeast U.S.
Impact Forecasting said that total economic and insured losses from this event should reach well into the hundreds of millions of dollars (USD) and that combined with last weeks tornadoes and convective storms the total bill to insurance and reinsurance markets will be in excess of $1 billion.
Meanwhile, European windstorm Zeus (or Yannick) struck France rather unexpectedly, as a low pressure system deepened and intensified rapidly on March 6th to 7th.
Windstorm Zeus swept through France on a south-easterly trajectory, bringing damaging hurricane force winds to wide swathes of the country. Zeus was at its most intense in Brittany and northwest France as it entered the country and again on exiting towards the Mediterranean around the Provence area.
At least two people died due to the impact of windstorm Zeus, with over 600,000 households suffering power outages and widespread damage to structures reported.
Impact Forecasting said that as Zeus impacted such a wide area of France the insurance industry loss can be expected to well exceed $100 million.
PERILS AG has windstorm Zeus under investigation and will report on the storm should it look like the insurance and reinsurance industry loss is heading for north of EUR 200 million.
Other severe weather and catastrophe events seen around the globe in the last week are less likely to cause major insurance or reinsurance impact, but demonstrate the protection gap.
These include wildfires across the U.S., which are expected to cause a reasonable sized economic loss but be largely uninsured, drought in Africa which could have caused close to $2 billion of economic losses but again will be largely uninsured, cyclone Enawo which struck Madagascar, and flooding in Oceania.