Flooding in Australia’s Northern Queensland region is set to result in economic losses of at least A$1.7 billion, with the cost for insurance and reinsurance firms said to be more than A$893 million, according to Aon.
The insurance and reinsurance brokers’ catastrophe risk analysis team Impact Forecasting said that flooding between January 26th and February 7th killed at least three people.
The most significant insured impacts were in the Townsville region of Queensland, with wider spread minor impacts around the Australian state.
The Insurance Council of Australia (ICA) has now recorded over 22,204 insurance claims and says that payouts will surpass A$893 million (US $635 million) for the insurance and reinsurance sector.
The total economic loss, made up of damage to property, infrastructure, and agriculture, will be around double that and is expected to be at least A$1.7 billion (US $1.2 billion), Aon’s team said.
These Australian floods may eat into some insurers catastrophe reinsurance provisions, particularly catastrophe aggregate layers of coverage.
Our sister publication Reinsurance News also reported that Brisbane-based insurer RACQ said its losses from the floods would likely be between $30 million and $50 million, but said they should be limited to just $20 million after its reinsurance protection kicks in.
Other insurers with exposure to these floods include IAG, QBE, Youi, Allianz and AIG, which are all likely to experience, although for most of these their retentions are high and the losses would need to either escalate or, like Suncorp, trigger an aggregate reinsurance layer they have in place.
Reporting on catastrophe and severe weather events that struck the globe in February, the Impact Forecasting team also highlights an expectation of hundreds of millions of U.S. dollars of loss for insurance and reinsurance interests from winter storms across the U.S. Midwest and Canada.
In addition, severe weather resulted in thunderstorms, large hail and tornadoes across the Central and Eastern U.S. from February 22-26, which is also expected to cost the insurance industry hundreds of millions.
Steve Bowen, Impact Forecasting Director and Meteorologist, commented, “As the calendar begins to shift from winter to spring in the Northern Hemisphere, increased focus is now on the official arrival of El Niño. While currently a weak El Niño episode and not expected to have significant impacts on global weather patterns, such conditions can still enhance regional phenomena. Given that the second and third quarters are typically the costliest for catastrophe losses, there will be continued monitoring of whether El Niño may have any notable influence on upcoming events.”
Other natural catastrophe loss events that struck the globe in February included:
- Severe weather impacted several in the Mediterranean region from February 23-26, killing at least eight people. The combination of strong winds and heavy rainfall caused moderate damage in Italy, Croatia, Greece, and Malta. The financial impact was expected to exceed EUR200 million.
- Multiple landslides were triggered in Bolivia between February 2-4 following days of heavy rainfall. On February 2, a mudslide struck multiple cars on the mountain highway. At least 23 people were killed or missing.
- A powerful upper level area of low pressure produced hurricane-force wind gusts, torrential rains, high surf, mountain snow, and some of the coldest temperatures in years in Hawaii on February 10. Nearly every main island reported varying levels of effects, though Oahu was affected the most.
- Torrential rains caused significant flooding in Chile during the first 10 days of February, killing at least six people. More than 5,700 homes were damaged or destroyed alone in the Arica y Parinacota, Tarapacá, and Antofagasta regions. The Chilean government allocated CLP60 billion (USD91 million) for event relief.