Asia: Region could see the next Katrina - AGCS
Source: Asia Insurance Review | Oct 2015
Asia is set to overtake the US as the region with the potential to generate the worst insured losses from windstorm events over the next 50 years, according to a study by Allianz Global Corporate and Specialty (AGCS).
Losses across Asia are expected to rise exponentially in future with 80% of the world’s top 10 exposed locations to coastal flooding from storm surge and wind damage expected to be in this region in the next five decades. In contrast, 10 years ago, only three Asian cities – namely, Osaka-Kobe, Tokyo, and Nagoya – were among the world’s top 10 such cities.
The forecast is in the report “Hurricane Katrina 10 – Catastrophe management and global windstorm peril review” published by AGCS to mark the 10th anniversary of Katrina. Hurricane Katrina struck the Gulf Coast of the US on 29 August 2005. It caused as much as US$125 billion in overall damages and more than $60 billion in insured losses. It remains the largest ever windstorm loss and the costliest disaster in the history of the global insurance industry.
Losses in Asia as a result of windstorm events are set to increase dramatically, because of economic growth and increasing wealth. Population growth, socio-economic growth and urbanisation are the most important drivers of the overall increase in exposure. Forecasts are that the population in Asia is set to double by 2050 – particularly in urban coastal areas. An increase in prosperity also means the number of people defined as “middle class” is expected to double between 2009 and 2020.
The top 10 cities globally ranked by asset exposure to coastal flooding in the 2070s are: