Insurers thrown billion dollar curveball amid subdued U.S. tornado season, according to Impact Forecasting catastrophe report - Tucson News Now

Insurers thrown billion dollar curveball amid subdued U.S. tornado season, according to Impact Forecasting catastrophe report

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SOURCE Aon plc

CHICAGO, June 5, 2014 /PRNewswire/ -- Impact Forecasting, the catastrophe model development center of excellence at Aon Benfield, today releases the latest edition of its monthly Global Catastrophe Recap report, which reviews the natural disaster perils that occurred worldwide during May 2014. Aon Benfield is the global reinsurance intermediary and capital advisor of Aon plc (NYSE:AON).

Aon Corporation (http://www.aon.com) is a leading provider of risk management services, insurance and reinsurance brokerage, human capital and management consulting, and specialty insurance underwriting. There are 37,000 employees working in Aon's 500 offices in more than 120 countries. Backed by broad resources, industry knowledge and technical expertise, Aon professionals help a wide range of clients develop effective risk management and workforce productivity solutions.

The report reveals that four periods of severe weather hit the United States during the month, resulting in aggregate insured losses estimated at more than USD1.0 billion, with economic losses likely to reach several billion dollars.

The costliest stretch occurred during a five-day period which damaged parts of the Midwest, Plains, Rockies, Mid-Atlantic and the Northeast, including the major metropolitan areas of Chicago and Denver. Despite the losses, by the end of May U.S. tornado activity for the year remained in the bottom 25th percentile of all years dating to the early 1950s.

Steve Bowen, associate director and meteorologist within Aon Benfield's Impact Forecasting team, said: "While tornado activity in the United States was fairly subdued during the month of May, there was no shortage of vigorous thunderstorm formation across the country. Large hail and damaging winds left considerable damage in many areas, which served as another reminder of how costly non-tornadic storm events can be for the insurance industry and local governments. Despite the relatively low activity of the 2014 tornado season, insurers are still faced with several billions of dollars in storm-related damage claims. However, the industry remains well-positioned financially as the focus in the U.S. begins to shift towards the start of the Atlantic hurricane season."

The heaviest rains in 120 years fell across portions of Southeast Europe during the second half of May, causing extensive flooding in Serbia and Bosnia. At least 80 people were killed, and economic losses were estimated to be near EUR3.3 billion (USD4.5 billion), with significantly lower insured losses due to low penetration rates.

Meanwhile, several days of heavy rainfall across southern China led to widespread flooding late in the month, killing at least 37 people and resulting in estimated economic losses of CNY7.4 billion (USD1.2 billion), according to the Ministry of Civil Affairs (MCA). The most severe damage was recorded in the provincial regions of Guangdong, Jiangxi, Hunan, and Guizhou with more than 95,000 homes damaged or destroyed by flood inundation. Roughly 265,000 hectares (655,000 acres) of agricultural land was also damaged.

The combination of excessive heat, extreme drought conditions, low relative humidity levels and gusty winds led to dozens of wildfires across parts of the Texas Panhandle and Southern California, killing two people. Overall fire costs/damages from the two states approached USD100 million.

A USGS-measured magnitude-6.0 earthquake struck northern Thailand, killing at least one person and injuring 23 others. Total economic losses were listed at THB2.0 billion (USD62 million), with insured losses of THB500 million (USD15 million).

In China, two earthquakes struck Yunnan Province near the border of Myanmar, injuring 60 people in total. The first tremor damaged or destroyed at least 45,000 structures, with total economic losses estimated at CNY367 million (USD60 million). The second temblor damaged nearly 22,000 homes in Yingjiang County.

A strong offshore magnitude-6.9 earthquake rattled parts of Greece and Turkey, injuring 324 people.

To view the full Impact Forecasting May 2014 Global Catastrophe Recap report, please follow the link below:

http://bit.ly/1uj9LYq

To access the Catastrophe Insight website, please visit:

www.aonbenfield.com/catastropheinsight                        

About Aon Benfield

Aon Benfield, a division of Aon plc (NYSE: AON), is the world's leading reinsurance intermediary and full-service capital advisor. We empower our clients to better understand, manage and transfer risk through innovative solutions and personalized access to all forms of global reinsurance capital across treaty, facultative and capital markets. As a trusted advocate, we deliver local reach to the world's markets, an unparalleled investment in innovative analytics, including catastrophe management, actuarial and rating agency advisory. Through our professionals' expertise and experience, we advise clients in making optimal capital choices that will empower results and improve operational effectiveness for their business. With more than 80 offices in 50 countries, our worldwide client base has access to the broadest portfolio of integrated capital solutions and services. To learn how Aon Benfield helps empower results, please visit aonbenfield.com.

About Impact Forecasting® LLC

Impact Forecasting is a catastrophe modeling center of excellence whose seismologists, meteorologists, engineers, mathematicians, finance risk management and insurance professionals analyze the financial implications of natural and man-made catastrophes around the world.  Impact Forecasting's experts develop software tools and models that help clients understand risks from hurricanes, tornadoes, earthquakes, wildfires and terrorist attacks on property, casualty and crop insurers and reinsurers.  To find out more about Impact Forecasting® LLC, visit www.impactforecasting.com.

Media Contacts:






David Bogg

Andrew Wragg 

Alexandra Lewis

Aon Benfield 

Aon Benfield 

Aon Benfield

t: +44 (0)20 7522 4016 

t: +44 (0)20 7522 8183 

t: +44 (0)20 7882 0541

e:david.bogg@aonbenfield.com 

e:andrew.wragg@aonbenfield.com 

e:alexandra.lewis@aonbenfield.com

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