Japanese domestic insurers have now paid out roughly US $9.2 billion in claims related to typhoon Faxai, typhoon Hagibis and the heavy rainfall event that closely followed these storms, which is an increase of 35% on figures released in December by the General Insurance Association of Japan (GIAJ).
In its latest update on these recent Japanese catastrophe events, the General Insurance Association of Japan’s data shows a steady increase in claims filed and paid.
However, the level of losses remains far below where the market had initially assumed they would finish, particularly for typhoon Hagibis, which is perhaps further evidence of the fact that loss development has proven better than initially feared in the insurance and reinsurance market with this storm, as we explained earlier this week.
The figure of US $9.2 billion is based on insurance claims data for the three catastrophe events, typhoons Faxai and Hagibis, as well as the extreme rainfall event that followed shortly afterwards.
The overall figure is a roughly 35% increase on the US $6.83 billion of losses that the GIAJ reported back in December.
For typhoon Faxai, the GIAJ now cites claims as reaching around US $4 billion, which is up almost 31% on the December figure of around $3.06 billion.
The GIAJ reports 430,545 claims filed for typhoon Faxai and 381,226 claims payments made, so there is further for this loss figure to rise.
For typhoon Hagibis, which came after Faxai, the GIAJ now reports the claims figure as reaching around US $5 billion, which is a roughly 38% increase since December’s $3.62 billion.
There are now 336,410 of claims accepted and filed for typhoon Hagibis and some 290,433 claims payments made.
The fact the number of claims filed is lower with Hagibis than Faxai could be related to the greater contribution of water and flooding related claims, rather than wind with the more recent storm, resulting in slightly fewer but larger claims.
Or, it could be a sign that typhoon Hagibis claims are slower to come in, perhaps reflecting the expectation that some sources in Japan have that demand surge could be an issue for claims from typhoon Hagibis.
Demand surge can slow down the claims process for major catastrophe events. It remains to be seen how these still being settled catastrophe event claims could be slowed down further now by the coronavirus outbreak.
Both typhoons Faxai and Hagibis have driven significant losses into the reinsurance market, helping to ensure that reinsurance firms are seeking out higher rates at the soon to complete April renewal season.
The expectation is that renewal rates for Japanese wind reinsurance risks will move upwards by as much as 50%, where badly loss affected.
For the heavy rainfall event in October that followed closely behind Hagibis the GIAJ now reports that 13,348 claims have been accepted and 11,229 claims payments made, amounting to around US $205 million, a 37% increase since December.
On the latest claims paid figures from the GIAJ, typhoon Hagibis is already the third most expensive insurance and reinsurance market loss from a Japan typhoon event and Faxai is now the fourth most costly.
Hagibis will almost certainly move up to second in the above list, after 2018’s typhoon Jebi, with Mirielle likely to remain in third and Faxai coming in fourth.
However, if these two 2019 Japan typhoons experience any loss creep over the coming months, Faxai could perhaps make it up into third, above Mirielle, at a push, although right now that seems a little less likely.