This weeks severe weather, convective storms and tornado outbreaks across the central and eastern U.S. could drive economic losses of over $1 billion, while the insurance and reinsurance market impact is likely in the hundreds of millions of dollars, according to Aon.
Impact Forecasting, the risk modelling and forecasting focused unit of insurance and reinsurance broker Aon, took a look at the recent outbreak of severe convective weather in its latest weekly report, highlighting the potential for the “major severe weather outbreak” to drive insurance industry losses.
Dozens of people were injured as the severe weather swept across the central and eastern states.
The “multi-day event prompted at least 23 confirmed tornado touchdowns, up to softball-sized hail, damaging straight-line winds, synoptic winds, and flash flooding,” Aon’s Impact Forecasting explained.
The weather systems formed from March 27th to the 30th, with significant convective storms forming across the Midwest and Plains on March 27th and 28th.
In particular, “March 28 was a very destructive and notable day” Impact Forecasting said.
“The hardest-hit areas included Arkansas, Illinois, Missouri, Iowa, and Indiana as a high volume of residential and commercial properties, vehicles, and agriculture were damaged or destroyed,” the company said.
One tornado in particular drove a significant proportion of the losses in the last week, strking Arkansas.
Impact Forecasting noted that, “The most catastrophic tornado occurred in Jonesboro, Arkansas. The EF3 tornado with up to 140 mph (220 kph) winds twister touched down in the city limits and rapidly intensified as it entered the heart of the city.”
Adding that, “Other notable tornado events during the outbreak included separate EF2 twisters that impacted Henderson County, Kentucky and Warrick County, Indiana. NWS meteorologists confirmed tornado touchdowns in Arkansas, Iowa, Indiana, Illinois, Wisconsin, and Kentucky.”
There was also convective storm activity that resulted in large hail and strong synoptic and straight line wind, as well, driving further damages and potential losses for the insurance and reinsurance industry.
“Given the extensive coverage of damage from tornadoes, large hail, straight-line winds, and synoptic- induced winds, it is anticipated that total economic and insured losses will each reach well into the hundreds of millions (USD); though it is expected that the economic cost may approach or exceed USD1 billion,” Aon’s unit explained.
“This would mark the second billion-dollar severe convective storm event in March 2020; the first was the early March event that prompted a series of tornadoes in metro Nashville, Tennessee. There are three confirmed billion-dollar events in the United States thus far: January 10-12 severe weather; February 3-8 severe weather; March 2-5 severe weather.”