Australia’s Cyclone Seroja leaves A$434m insurance industry loss

Share

Tropical Cyclone Seroja, which impacted Western Australia earlier this year, is initially estimated to have caused a A$434 million industry loss for the insurance and reinsurance market, according to PERILS.

PERILS AG logoTropical cyclone Seroja struck Australia over the period of 11 to 12 April 2021, making landfall just south of the town of Kalbarri at 8.00pm local time on the 11th.

Cyclone Seroja caused strong winds to impact an area of approximately 800km of the Mid-West Australia region coastline.

Wind gusts extended further inland as cyclone Seroja continued a south-south-easterly track into the morning of 12th April and the highest gust speeds were recorded in the town of Kalbarri which reported wind speeds of 170km/h, while other locations in the region experienced gusts above 125km/h.

PERILS notes that cyclone Seroja was a comparably “dry” event with moderate rainfall, meaning that most of the damage from came from the storms strong winds.

PERILS reporting threshold for Australian insurance and reinsurance market loss events is actually set at A$500 million, but it felt Seroja worth reporting on due to the size of the loss for the Western Australia region and the fact the cyclone generated enough coverage to warrant investigation.

The Western Australia region has not experienced a comparable insured loss event since the Perth Hailstorms of 2010, and a number of damaging cyclones in the 1970s, including Cyclone Joan (1975), Alby (1978), and Hazel (1979).

The company also notes that, while losses began slowly for cyclone Seroja, in recent weeks, the insurance industry has experienced significant claims development.

The initial industry loss figure of A$434 million covers both the property and motor hull lines of business.

Darryl Pidcock, Head of PERILS Asia-Pacific, said, “Seroja was an unusual event both from a meteorological and an insurance perspective. Meteorologically, the event was special due to a phenomenon known as the Fujiwhara effect whereby Seroja interacted with another cyclone named Odette. This interaction pushed Seroja further south along the Western Australian coastline to make landfall at an unusually high intensity for the given latitude. From an insurance industry perspective, cyclone Seroja presented considerable challenges, given the degree of destruction in remote and sparsely populated areas, causing claims inflation due to building material supply issues and attracting labour to the region.”

———————————————————————
Artemis Live - ILS and reinsurance video interviews and podcastView all of our Artemis Live video interviews and subscribe to our podcast.

All of our Artemis Live insurance-linked securities (ILS), catastrophe bonds and reinsurance video content and video interviews can be accessed online.

Our Artemis Live podcast can be subscribed to using the typical podcast services providers, including Apple, Google, Spotify and more.

Print Friendly, PDF & Email

Artemis Newsletters and Email Alerts

Receive a regular weekly email newsletter update containing all the top news stories, deals and event information

  • This field is for validation purposes and should be left unchanged.

Receive alert notifications by email for every article from Artemis as it gets published.

Read previous post:
Increased awareness of ILS in Asia but communication vital: ILS Asia 2021

Knowledge and understanding of the insurance-linked securities (ILS) asset class is on the rise in Asia, and while local expertise...

Close