This weeks severe weather across parts of the United States, made up of thunderstorms, hail, convective storms, tornadoes and a derecho event that struck Houston, Texas, is all anticipated to result in losses in the billions for the insurance and perhaps reinsurance market.
Broker Aon said today that the ultimate total will rise into the billions from this week’s continuation of severe convective storms (SCS) across the US.
Meanwhile, reinsurance broker Gallagher Re said earlier in the week that the May 16th Houston, Texas derecho event alone is expected to drive more than $1 billion of insurance market losses.
Aon’s Impact Forecasting division said today that, “During the period between May 16 and 22, a series of severe convective storm systems hit the southern and eastern United States.
“There were two main series of events, which turned out to cause a significant economic and insured damage that is expected to reach billions of US dollars.
“Particularly noteworthy was the derecho system that crossed the Gulf Coast from Central Texas to Central Florida and resulted in significant wind-related damage.”
The derecho event in Houston has been particularly impactful, but through the rest of the week severe convective storms (SCS) moved east and additional major tornado impacts were seen, in areas ranging from Kansas, to Nebraska, to Iowa.
Aon’s Impact Forecasting further stated, “The recent outbreaks resulted in a widespread damage from a mixture of hazards including strong winds, tornadoes, large hail and heavy rain. Probably the costliest individual system was the derecho that impacted the population centres along the Gulf Coast.
“As damage assessments and claim filing will continue, it is too early to provide a definitive estimate of eventual financial impacts.
“However, given the extent of damage and the exposure centers hit by the event, it is very likely that the event will result in losses in the billions of USD.
“Additional, noteworthy impacts were caused by the thunderstorm activity during the entire period from May 16 to 22.”
Tornado reports are now running well-ahead of the average so far this year and inflation adjusted tornado reports are above the 75th percentile so far.
Hail reports are running close to trend as well, while reports of strong winds are well above the trendline now.
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