US storms in May will cost insurers billions: AonPosted On: Jun. 6, 2019 2:13 PM CST
Insurers are on the hook for a multibillion-dollar payout as a result of severe convective storms across much of the United States in May including more than 362 tornadoes — the highest tally for this month since 2015, according to a report Thursday from Aon PLC.
No fewer than seven outbreaks of severe convective storms swept across central and eastern parts of the U.S. in May, and the overall impact will be in the billions of dollars, according to Aon PLC’s global catastrophe recap.
“Severe convective storms have resulted in at least US$10 billion in U.S. insurance payouts annually since 2008, and we are likely headed towards a 12th consecutive year,” Steve Bowen, director and meteorologist within Aon’s Impact Forecasting team, said in the statement.
Preliminary data from the National Oceanic and Atmospheric Administration points to nearly 4,400 individual reports of tornadoes, hail and straight-line winds during May 2019, the highest number for that month since 2011, Aon said in a statement.
Record-breaking rainfall in Oklahoma and Kansas also resulted in historic flooding throughout the Arkansas river basin as well as flooding in the Missouri and Mississippi river basins, adding hundreds of millions in economic losses, Aon said.
A multiday outbreak from May 4-10 that hit parts of Texas, Louisiana, Oklahoma, Kansas and Arkansas the hardest is expected to result in up to $850 million in economic losses, with public and private insurers expected to cover up to $620 million of the cost, Aon said in the report.
Another outbreak of severe storms from May 16-17 during which tennis ball-sized hail hit the Chicago area is expected to result in $325 million in insured losses and at least $425 million in economic costs overall, according to the report.
Golf ball to baseball-sized hail, damaging straight-line winds and a confirmed EF2 tornado were also a feature of another outbreak across parts of North Carolina on May 13, where total economic costs are estimated at nearly $300 million, with insurers expected to pay out roughly $215 million, the report said.
Hundreds of millions of dollars of additional economic and insured losses are expected from four further outbreaks of severe weather, one across parts of the Plains, Midwest and Northeast from May 17-19 where Texas felt the brunt of the damage due to multiple rated EF2 or EF3 tornado touchdowns, the report said.
Another multi-day outbreak in the Plains, Midwest, Southeast and Northeast from May 20-23 resulted in nine fatalities and left more than 100 injured, and was marked by six EF3 tornadoes in Missouri, Texas, Kansas and Oklahoma, Aon said.
An outbreak from May 24-25 in the Rockies, Plains, Midwest and Northeast left two dead and dozens more injured and saw dozens of tornado touchdowns, including an EF3 that struck El Reno, Oklahoma, the report said.
Another outbreak that hit the central and eastern U.S. from May 26-31 included two EF4 tornadoes with up to 170 mph winds causing major damage in Dayton, Ohio, and Linwood, Kansas, and resulted in three fatalities and more than 150 injuries, the report said.
Also in May, Cyclone Fani made landfall in India, causing direct economic losses of around $2 billion, while heavy rainfall led to significant flooding across parts of Europe, China and the Middle East, the report said.