Global economy endures near $20bn loss from Q1 natural hazards; insurers face $7bn payout, according to Impact Forecasting catastrophe report
CHICAGO, April 9, 2014 /PRNewswire/ -- Impact Forecasting, the catastrophe model development center of excellence at Aon Benfield, today releases the latest edition of its monthly Global Catastrophe Recap report, which reviews the natural disaster perils that occurred worldwide during March 2014. Aon Benfield is the global reinsurance intermediary and capital advisor of Aon plc (NYSE: AON).
For the second consecutive year, severe drought conditions impacted Brazil, leading to agricultural losses in excess of BRL10 billion (USD4.3 billion). Around 10% of Brazilian farm land is covered by insurance.
In Pakistan, a major drought continued during the month, killing at least 212 people in the Sindh Province, resulting in significant loss of livestock and agriculture. The government has allocated PKR1.8 billion (USD18 million) for relief and recovery.
In Haiti, a state of emergency was also declared for six parishes after farmers lost a second consecutive annual harvest crop.
Meanwhile, continuing severe winter weather led to damage and fatalities across the United States during March, as multiple storm systems crossed the country. One notable winter storm brought significant snow, sleet, freezing rain accumulations and isolated flooding to the Carolinas and Virginia, leading to total economic damages of around USD100 million, and an expected insurance payout above USD50 million.
For the U.S. winter of 2013/14, as of March 31, economic damages had reached USD5.7 billion, with at least USD2.6 billion covered by insurance. Europe endured its costliest windstorm season since 2009/10, with insurers expected to pay out more than USD4.0 billion in storm-related claims.
For the first quarter of 2014, preliminary estimates indicate that around USD20 billion in economic damages and USD7.0 billion in insured losses occurred from around 70 natural disasters worldwide.
Steve Bowen, associate director and meteorologist within Aon Benfield's Impact Forecasting team, said: "Despite the nearly 70 natural disaster events experienced globally during the first quarter of 2014, the financial losses attributed to these events were largely negligible to economies and insurers. The preliminary tallies of nearly USD20 billion in economic damages and USD7.0 billion in insured losses were both close to the level of losses sustained in 2012 and 2013, but well below those seen in 2010 and 2011. However, while this year's first quarter losses were manageable for insurers, it is worth remembering that the second and third quarters are historically the costliest for the industry as severe thunderstorms, floods, droughts, and tropical cyclone activity become more prevalent."
Elsewhere during March, a massive mudslide struck the community of Oso, Washington, killing at least 33 people. The nearly mile-wide (1.2-kilometer) swath of mud and debris destroyed nearly 50 homes and other structures as mud and debris up to 20 feet (6.1 meters) decimated the region. Total economic damages were listed at USD10 million.
Persistent rainfall, which began in mid-February, continued across parts of South America during the month, as multiple rivers burst their banks and caused flooding in parts of Brazil, Bolivia and Peru. The rains were most pronounced in the Brazilian states of Rondonia (near the border of Bolivia) and Acre (near the border of Peru), where a combined 29,500 families were left homeless. Total economic losses in the region were estimated in excess of USD200 million.
Significant floods also occurred in South Africa, killing 32 people and causing economic damages listed at ZAR900 million (USD85 million), and in New Zealand, with a 1:100-year rainfall event affecting the Canterbury region.
Three separate stretches of severe weather impacted central, eastern and southern sections of China. Combined data from the Ministry of Civil Affairs (MCA) indicate that 26 people were killed, 100,000 homes were damaged or destroyed, and total economic damages reached CNY1.32 billion (USD374 million).
Cyclone Hellen became one of the strongest tropical cyclones ever recorded in the northern Mozambique Channel before weakening and making landfall in Madagascar. Following the storm, 17 people were left dead or missing.
Cyclone Lusi tracked through Vanuatu, bringing flooding rains and hurricane-force winds. At least 12 people were left dead or missing as heavy damage occurred in Penama and Shefa provinces.
To view the full Impact Forecasting March 2014 Global Catastrophe Recap report, please follow the link below:
To access the Catastrophe Insight website, please visit:
About Aon Benfield
Aon Benfield, a division of Aon plc (NYSE: AON), is the world's leading reinsurance intermediary and full-service capital advisor. We empower our clients to better understand, manage and transfer risk through innovative solutions and personalized access to all forms of global reinsurance capital across treaty, facultative and capital markets. As a trusted advocate, we deliver local reach to the world's markets, an unparalleled investment in innovative analytics, including catastrophe management, actuarial and rating agency advisory. Through our professionals' expertise and experience, we advise clients in making optimal capital choices that will empower results and improve operational effectiveness for their business. With more than 80 offices in 50 countries, our worldwide client base has access to the broadest portfolio of integrated capital solutions and services. To learn how Aon Benfield helps empower results, please visit aonbenfield.com.
About Impact Forecasting® LLC
Impact Forecasting is a catastrophe modeling center of excellence whose seismologists, meteorologists, engineers, mathematicians, finance risk management and insurance professionals analyze the financial implications of natural and man-made catastrophes around the world. Impact Forecasting's experts develop software tools and models that help clients understand risks from hurricanes, tornadoes, earthquakes, wildfires and terrorist attacks on property, casualty and crop insurers and reinsurers. To find out more about Impact Forecasting® LLC, visit www.impactforecasting.com.
SOURCE Aon Benfield