News Non-Life12 Oct 2018

Asia:Region sees billions of dollars of insured losses from Nat CATs in Sep

| 12 Oct 2018

September saw several natural disasters in Asia, causing billions of dollars of losses for insurers and fatalities numbering into several thousands, according to Aon's Impact Forecasting team in its monthly report titled, "Global Catastrophe Recap: September 2018".

Among the major disasters, Typhoon Jebi made landfall in Japan and prompted widespread wind and flood damage across numerous prefectures. According to the Japan Meteorological Agency, Jebi became the strongest typhoon to strike the Japanese mainland since 1993. Total economic losses were expected to reach well into the billions of dollars. The General Insurance Association of Japan (GIAJ) said that nearly 486,000 insurance claims had been filed. A multi-billion-dollar payout is expected.

Super Typhoon Mangkhut caused widespread impact in the Philippines, Hong Kong, and China. The Category 5 storm left at least 102 people dead. More than 210,000 homes were damaged in the Philippines alone, and further storm surge, wind, and inland flood damage was noted across parts of China, Hong Kong, and Macau. Total combined economic damage and net loss business interruption was expected to reach into the billions of dollars. The local insurance industry in China and Hong Kong cited the likelihood of payouts approaching or exceeding $1bn. Total insured losses, including payouts from physical damage and business interruption to casinos in Macau, were expected to approach or exceed $1bn.

A major magnitude-7.5 earthquake and tsunami caused catastrophic damage across Indonesia’s Sulawesi Island on 28 September, leaving an estimated 2,000 people dead and many more missing. Excessive damage resulting from ground shaking and liquefaction additionally caused widespread structural impact. Total economic damage was expected to approach $1bn. Insured losses were likely to be negligible due to very low insurance penetration.

Another strong earthquake struck the Japanese island of Hokkaido on 6 September. Authorities confirmed 41 fatalities and 680 injuries. The GIAJ cited that 12,279 insurance claims had been filed. Total economic losses were anticipated to exceed $1bn. Direct losses to the farming, forestry, fishing, and tourism industries alone were expected to reach JPY68.9bn ($605m).

Between August 29-September 5, heavy rainfall triggered landslides and flash floods across northern Vietnam and various parts of China. The inclement weather left at least 20 people dead or missing in Vietnam and damaged more than 1,200 homes in several northern provinces. In China, no fewer than 3,800 houses were damaged, and 18 people were killed. Total economic losses in China were estimated to minimally reach CNY5.4bn ($790m).

In India, at least 86 administrative divisions across 23 districts in the state of Karnataka were declared to be in a drought after receiving minimal rainfall in the current monsoon season. Nearly 1.2m hectares of crops were lost due to the drought, which resulted in a financial cost of INR80bn ($1.1bn).

Globally, economic losses from Nat CATs in September are estimated in the tens of billions.

Mr Steve Bowen, Impact Forecasting Director and Meteorologist, said: “September will be recorded as the costliest month so far of 2018, as global economic losses from natural catastrophes are expected to reach into the tens of billions of dollars. A series of significant catastrophes – including Hurricane Florence, Typhoon Jebi, Typhoon Mangkhut, and the Indonesian earthquake – were poised to cause tens of billions in economic damage. Each of these events were also noteworthy since the majority of losses are likely to be uninsured. This once again highlights that whether a country is considered mature or emerging, there continue to be gaps in insurance coverage on either a market-wide or individual peril basis.”

 

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