Aon Benfield’s catastrophe model development team Impact Forecasting said Thursday that tornados and severe thunderstorms caused American economic losses of more than $3 billion USD in May, around a third of which ($1 billion) is insured losses.
The wettest May on record in the US comes on the heels of Aviva Canada’s announcement that they would be the first personal lines insurance company to offer overland water protection in Canada.
“The fact is that Canada is wetter, warmer and stormier than it’s ever been,” said Sharon Ludlow, president, Aviva Insurance Company of Canada.
“Compared to 60 years ago, Canada now has an additional 20 days of rain each year and 12 per cent more rainfall,” she said.
The US is experiencing similar increases. The Aon report details major flooding in Texas and Oklahoma in the month of May, resulting in 41 deaths, most of which came in a one-week stretch from May 23-30 that saw riverine and flash flooding. Flooding hit more than 5,000 homes in Texas including metro regions like Houston, Austin and Dallas.
“A meteorologically active month around the globe in May was highlighted by record rainfall from persistent thunderstorms across the U.S. states of Texas and Oklahoma,” said Steve Bowen, associate director of Impact Forecasting.
“The rains, which were 500 percent greater than normal values for the month of May in some locations, led to major riverine and flash flooding in areas that had long been mired in a multi-year drought,” he said. “In the immediate aftermath of the event, Impact Forecasting was able to successfully implement flood extents and scenarios into our U.S. flood model for deployment to clients."
On top of the rainfall and flooding, the report estimates that 412 tornadoes touched down in May, which would be the highest number of tornadoes in the U.S. since April of 2011. The report also documents softball-sized hail and high winds of up to 130 kilometres per hour caused damage across the central and eastern U.S.
As Canada is experiencing similar increases in rainfall and severe weather events.
“The wakeup call for us in the insurance industry was the catastrophic flooding that occurred in Alberta and Ontario in 2013,” said Ludlow. “The scale of these disasters is really what got people’s attention.”
Flooding has caused the greatest aggregate amount of property damage in Canada, and with approximately 20 per cent of the world’s fresh water located here, floods are also the most frequent Canadian natural disaster.
Aviva Canada was the first company to offer overland water protection on residential home insurance policies, and other companies have since followed suit.
“While our industry was slow in addressing this issue, we’re pleased to say that we’ve finally caught up to it, and you soon see overland water offerings from many insurers,” said Ludlow.