From Artemis, November 30:
The 2020 hurricane season – a story of storm frequency & rapid intensification
The 2020 Atlantic hurricane season comes to its official close today and two factors characterise what has been a record-setting season in many ways, the frequency of tropical storms and their rapid intensification, especially as they close in on landfall.
The 2020 Atlantic hurricane season saw a record number of named tropical storms form during the period, with 30 named storms taking use well into the Greek alphabet for names.Of those record 30 named tropical storms, 13 intensified to become hurricanes, the second most hurricanes in a season on-record after 2005 which saw 15 hurricanes form.
Of the 13 hurricanes, 6 became major hurricanes with category 3 wind speeds or higher, again the second most major hurricanes in a season on-record after 2005.
Perhaps the most notable record for the global insurance, reinsurance and insurance-linked securities (ILS) industry though, is the fact that 12 tropical storms made landfall in the United States during the 2002 season, beating the previous record of 9 named storm landfalls set in 1916.
2020 saw the busiest September on record for named storm formation, a key month in the season, while May, July and November, all tied their records for numbers of named storms to form in the month.
Potentially even more notable for the insurance, reinsurance and ILS sector could have been the fact 6 hurricanes made landfall in the United States during the 2020 season.
However, the high frequency of named storms, hurricanes and also United States landfalls, has not resulted in the kind of losses that insurance and reinsurance markets might typically fear such an active season would produce.
While some regions have been devastated by the hurricanes in 2020, in particular Nicaragua and surrounding countries of Central America, as well as parts of coastal Louisiana in the United States, the impacts from the season have not been as severe as they could have been.
Location of landfalls has been key to this, with the most intense storms striking Central America, while the hurricanes striking the United States have largely come ashore in less populated, lower exposure and insured value regions.
The 2020 Atlantic hurricane season is estimated to have driven at least $40 billion of economic losses, but the insurance and reinsurance sector bill will be much lower it seems.
Insurance and reinsurance market loss estimates differ widely and there is a significant range of estimates, as ever.
Lately, estimates from industry sources are rising for some of the U.S. hurricanes as well, in some cases suggesting some inflationary effects from the COVID-19 pandemic.
But it seems likely the 2020 Atlantic hurricane season could drive around $25 billion of U.S. insured losses, while the figure would be $30 billion or perhaps a little more if including all offshore energy market losses, NFIP public flood insurance losses and impacts in the Caribbean, Mexico and Central America as well....
....MUCH MORE
Now, before we start weeping for the insurance/reinsurance companies remember it was just a few years ago (2015) we were posting NASA: "No Major U.S. Hurricane Landfalls in Nine Years: Luck?".
By September 2017 it was "Hurricane Irma landfall in Florida would hit reinsurers hard: KBW":Well kids, with no landfalling major - category 3 and above - hurricane in the U.S. (Sandy wasn't a hurricane at landfall) for over a decade it's been a great ride for the insurers/re-insurers/insurance-linked-securities folks..
Related, December 7:
Accumulated Cyclone Energy 2020 Year-to-Date
