Typhoon Halong loss could be similar to Roke’s estimated $1.1 billion

The eventual insured loss total for typhoon Halong which struck Japan at the weekend could be of a similar magnitude to 2011’s typhoon Roke which was estimated at $1.1 billion, according to risk modeller AIR Worldwide.

Typhoon Halong struck Japan on Sunday, having been downgraded to a tropical storm just prior to landfall. Despite the lower windspeeds, it was the rainfall levels which will drive the majority of the insurance and reinsurance industry losses from Halong, with record levels of rain experienced in many areas of Japan in recent weeks.

In some cases as much as three feet of rainfall was dumped by typhoon Halong as the storm passed along the main Japanese islands. This prompted a rare emergency weather warning from the Japanese Meteorological Agency, resulting the evacuation of half a million people.

“As of Monday morning JST, Halong had transitioned to a post-tropical cyclone located at 43° North latitude and 137° East longitude over the Sea of Japan,” Dr. Anna Trevino, scientist at AIR Worldwide, said in an update. “Currently, Halong exhibits sustained winds of 56-111 km/h (35-69 mph). Flood warnings, however, remain in effect throughout Hokkaido, Japan’s northernmost major island.”

“Halong lashed the region with high winds and torrential rains, including the major cities of Osaka, Kobe, and Kyoto. Record-breaking rainfall was recorded in Mie Prefecture—which was inundated by nearly 17 inches of rain in 24 hours—prompting an emergency weather warning by the JMA that triggered the evacuation of half a million people,” continued Dr. Trevino.

Rainfall rates recorded are astounding in many cases, with one area of Kochi prefecture reporting 33.94 inches of rain in a 24 hour period due to Halong and over 42 inches in a 72 hour period. The extreme rainfall resulted in landslides in Kochi prefecture and widespread flooding and is among the 10 largest rainfall levels recorded since the observation network was installed by the JMA in the 1970’s.

Dr. Trevino noted the similarity to 2011’s typhoon Roke; “Following on the heels of Typhoon Neoguri, which impacted southern Japan a month ago, Halong inflicted further damage on the already saturated region. Taken together, Neoguri and Halong caused flood damage to over 2,000 homes across Japan, with both storms causing the most damage in Kochi prefecture. In addition, note that Halong followed a track path similar to that taken by Typhoon Roke in 2011, which caused major flooding and damaged over 3,000 homes; insured losses from Roke have been estimated at USD 1.1 billion, primarily as a result of flood damage.”

Risk modelling firm RMS highlighted some wind damage caused by typhoon Halong, as well as the flooding impacts, in its latest update on the storm:

Tochigi Prefecture on Honshu Island, 60 mi (100 km) north of Tokyo, appears to be the worst affected by wind damage, which may be associated with an unconfirmed tornado. In southern Honshu, Mie Prefecture also experienced wind damage from Halong.

Kochi and Tokushima Prefectures on Shikoku Island appear worst affected by flooding with the Japanese Fire and Disaster Management Agency (FDMA) reporting that over 270 houses have suffered some wind related damage, while close to 2,500 homes have experienced flooding, over 700 of which were above floor level (09:00 local time August 11).

Over 1.6 million people were ordered to evacuate southern Japan on Saturday August 9 and Sunday August 10 as a precaution against strong winds and landslides triggered by heavy rainfall.

Landslides have been reported in Kochi Prefecture on Shikoku Island as a result of the heavy rainfall brought by Halong, which downed a number of trees, though reports indicate that no homes have yet been affected by the landslides in these regions.

Even at $1.1 billion the insurance industry loss from typhoon Halong will not trouble exposed Japan typhoon catastrophe bonds, such as Aozora Re Ltd. (Series 2014-1) & Akibare II Ltd., it also won’t trouble the reinsurance sector unduly as most of a loss that size would be expected to fall to the Japanese primary insurers.