Tuesday, 18 September 2018
BOSTON, Sep 18, 2018 - (ACN Newswire) - Catastrophe risk modeling firm AIR Worldwide estimates that industry insured losses resulting from Hurricane Florence's winds and storm surge will range from USD 1.7 billion to USD 4.6 billion. Note that these estimates do not include the impact of the ongoing flooding from Hurricane Florence's unprecedented precipitation. AIR Worldwide is a Verisk (Nasdaq:VRSK) business.
"Hurricane Florence, once a Category 4 storm, made landfall near Wrightsville Beach, North Carolina, at about 7:15 a.m. on Friday, as a Category 1 storm with 90 mph winds," said Dr. Peter Sousounis, vice president and director or meteorology, AIR Worldwide. "As Florence approached the East Coast, it grew in size and exhibited multiple wind maxima, which are found in storms with abnormally low central pressure for a given maximum wind speed. As a consequence, strong winds extended well north of the landfall location up to the Outer Banks and into Pamlico Sound, which caused a high storm surge in this area."
Florence's slow movement - it progressed at between 3 and 6 mph on Friday - has ensured that its principal impact will be from the excessive precipitation being deposited over an extremely wide area. A USGS gauge in Emerald Isle, North Carolina, recorded 6.1 feet above normal water levels and a 10-foot surge was reported in New Bern, North Carolina.
According to preliminary reports from the National Weather Service, 35.93 inches fell in Elizabethtown, North Carolina, breaking the record set by Hurricane Floyd in 1999, and more than 30 inches of rain fell on Swansboro, North Carolina. Many other locations received more than 20 inches. Several bodies of water have risen above record levels and some of the gauges used to record river levels have been submerged, with at least two being reported as having stopped working.
Reported wind damage in the affected area is consistent with that of a Category 1 hurricane, including downed trees causing damage to homes and automobiles; downed utility poles; and shingle loss with isolated cases of more extensive roof damage.
The heavy rainfall deposited by Florence has caused widespread riverine and flash flooding in many parts of North Carolina and South Carolina. Some dams and levees in the region are reportedly showing signs of distress; a dam in Hoke County, North Carolina, west of Fayetteville, has failed and the Lake Corriher levee experienced a partial breach.
Flooding may worsen in many locations across South Carolina, North Carolina, and Virginia as precipitation continues to fall on saturated ground and runoff drains slowly toward the coast.
AIR's modeled insured loss estimates include:
- Insured physical damage to property (residential, commercial, industrial, auto), both structures and their contents
- Additional living expenses (ALE) for residential claims
- For residential lines, 5% of modeled storm surge damage as wind losses
- For commercial lines, insured physical damage to structures and contents, and business interruption directly caused by storm surge (other flood losses are not modeled or reflected in estimates; business interruption losses include direct and indirect losses for insured risks that experience physical damage)
- For the automobile line, estimates reflect AIR's view that insurers will pay 100% of the storm surge damage
- 2018 indexed take-up rates
AIR's modeled insured loss estimates do not include:
- Precipitation-induced flooding
- Losses paid out by the National Flood Insurance Program
- Losses resulting from the compromise of existing defenses (e.g., natural and man-made levees)
- Losses to uninsured properties
- Losses to infrastructure
- Losses to inland marine, marine cargo and hull, and pleasure boats
- Losses from extra-contractual obligations
- Losses from hazardous waste cleanup, vandalism, or civil commotion, whether directly or indirectly caused by the event
- Other non-modeled losses, including those resulting from tornadoes spawned by the storm
- Losses for U.S. offshore assets and non-U.S. property
About AIR Worldwide
AIR Worldwide (AIR) provides risk modeling solutions that make individuals, businesses, and society more resilient to extreme events. In 1987, AIR Worldwide founded the catastrophe modeling industry and today models the risk from natural catastrophes, terrorism, pandemics, casualty catastrophes, and cyber incidents. Insurance, reinsurance, financial, corporate, and government clients rely on AIR's advanced science, software, and consulting services for catastrophe risk management, insurance-linked securities, longevity modeling, site-specific engineering analyses, and agricultural risk management. AIR Worldwide, a Verisk (Nasdaq:VRSK) business, is headquartered in Boston, with additional offices in North America, Europe, and Asia. For more information, please visit www.air-worldwide.com.
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Source: AIR Worldwide via Globenewswire
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