Impact of extra tropic
cyclones in Europe on Insurance Industry
Transcript of keynote
speech by Donald Burfitt-Dons continued
Awareness of the costs of winter storms to the insurance
industry and the economies of Europe generally has been rising in recent
years in tandem with the damage they are causing.
Various models have been put forward to attempt to
give guidelines as to what losses can be expected.
German institutions seem to be leading in this field
perhaps because of the larger landmass being affected. The costs of
an insurance event inflicted by a severe storm are a function of three
factors, footprint, intensity and track or position.
Tornadoes, although packing higher wind speeds, are more localised and
thus have a much smaller effect in terms of insurance, but can be very
costly in lives as we have seen in Tornado Alley in the US over the
years.
U.K.institions are also getting involved. Just up the
road UCL where my eldest daughter attends, the Benfield’s Hazard
Research Centre have come up with a forecasting service too, launched
in 2006. Only time will tell how well the various approaches and models
will work.
With some researchers now saying that an ETC has the
potential to cause losses of 40 billion euros in Europe the issue is
attracting broader attention.
European winter storms are responsible for 70-75 per
cent of all European insured losses since 1970. (Swiss Re)
You have seen from earlier on, that the energy released
in an Extra Tropic Cyclone are as the square for the wind strength.
From empirical observation the actual damage which results is closer
to a cube function, which takes us back to our aeronautical formula.
If we take the conservative view that winds have increased
by 15% in recent years that means the direct insurance costs are likely
to be at least 50% higher than we have been accustomed to prior to superwinds.
The broader costs to the economy, according to the Institute of Geophysics
and Meteorology, University of Cologne are double that.These are not
exactly negligible figures to contemplate by the insurance industry.
Continued Donald Burfitt-Dons discusses future implications
the
planet's way of recycling heat energy/
the first Brazilian hurricane/cyclones
outside the tropics/how
the GWA monitors hurricane activity/the
rising tropopause/ETC activity
since the 50s/l ETC activity
since 1990/ the effect of an ETC
on London /how superwinds form/
the impact of ETCs on aircraft/data
from 21 recent storms/ UK as a breeding
ground for tornadoes/
the impact on the insurance industry/
future implications /threat
of ETCs to Europe and UK
