AIR Estimates Insured Losses for Louisiana Floods to Range Between USD 8.5 Billion and USD 11 Billion
(Thomson Reuters ONE) -
For Immediate Release:
AIR Estimates Insured Losses for Louisiana Floods
to Range Between USD 8.5 Billion and USD 11 Billion
BOSTON, Sept. 19, 2016 - Catastrophe modeling firm AIR Worldwide estimates that
industry ground-up insurable losses-which include exposures eligible for
coverage (regardless of whether they are actually insured) without any
application of deductibles or limits-from the flooding in Louisiana caused by
excessive rainfall during August 2016 will be between USD 8.5 billion and USD
11 billion. AIR Worldwide is a Verisk Analytics (Nasdaq:VRSK) business.
"Extreme rainfall-induced flash flooding and river flooding on the floodplain
have wreaked havoc in Louisiana, breaking records and damaging property
throughout many parishes," said Dr. Boyko Dodov, vice president and director of
flood modeling at AIR Worldwide. "Beginning around August 10, 2016, rainfall
continued almost perpetually for approximately seven days, resulting in
accumulations of around 7.1 trillion gallons in Baton Rouge and the surrounding
suburbs, according to reports, reaching upwards of 30 inches in some areas."
August 2016 is now the wettest month on record for Baton Rouge since 1907. A
NOAA rapid-response study indicates that a rainfall event such as this is
expected to occur at least 40 percent more often than it was in our
preindustrial past.
Historic crests at 12 real-time river gauging stations of the USGS in Louisiana
were surpassed due to the rainfall event, including on the Amite, Comite,
Tickfaw, and Tangipahoa rivers. A report from the Baton Rouge Area Chamber
indicates more than 145,000 residences-housing upwards of 359,000 people-were in
flood-affected areas; almost 12,000 businesses-which together employ more than
136,000 people-are in areas identified as flood-affected.
The federal government declared 20 parishes major disaster areas. FEMA issued
USD 1 billion in Federal Disaster Assistance grants to those affected, including
National Flood Insurance Program (NFIP) policy holders who have received more
than USD 247 million to repair or rebuild damaged properties; more than 63,000
families have sought FEMA assistance for housing. The majority of homeowners
impacted by the floods reportedly did not have flood insurance because their
homes were not in flood zones, thus the financial burden of recovery is
inhibiting progress; around 850 people are said to still be in shelters.
AIR's loss estimates explicitly capture residential, commercial, and automobile
losses from inland flood both on and off the floodplain based on 100 simulated
event scenarios that reflect uncertainty in precipitation observations and
modeled levee failures. These loss estimates were derived based on AIR's high-
resolution Industry Exposure Database (IED) for the United States and damage
ratios estimated from reported flood inundation. The U.S. IED vintage is
December 2015.
The range in AIR's loss estimates also reflects uncertainty in the payment of
additional living expenses resulting from relocation, time spent in secondary
housing, lost wages, loss of electricity, and damage to contents. Please note
that total economic losses are expected to be higher than industry insurable
loss estimates.
The modeled hazard intensities reflect the maximum estimated river flows and
maximum excess runoff intensities during the event from August 8-19, 2016. Note
that many reinsurance contracts are subject to an hours clause (typically 168
hours for flood events). Given the duration of this event, AIR expects the flood
to be treated as a single occurrence in Louisiana.
AIR's insurable loss estimates reflect:
* Insurable physical damage to property (residential, commercial), both
structures and their contents, and auto
* Direct business interruption losses
The loss estimates do not reflect:
* Losses to land
* Losses to infrastructure
* Losses to CAR/EAR, Marine Hull, or Marine Cargo lines of business
* Indirect business interruption losses
* Loss adjustment expenses
* Demand surge-the increase in costs of materials, services, and labor due to
increased demand following a catastrophic event. Demand surge can be applied
by AIR software users who want to account for this variable.
About AIR Worldwide
AIR Worldwide (AIR) provides catastrophe risk modeling solutions that make
individuals, businesses, and society more resilient. AIR founded the catastrophe
modeling industry in 1987, and today models the risk from natural catastrophes,
terrorism, and pandemics globally. Insurance, reinsurance, financial, corporate,
and government clients rely on AIR's advanced science, software, and consulting
services for catastrophe risk management, insurance-linked securities, site-
specific engineering analyses, and agricultural risk management. AIR Worldwide,
a Verisk Analytics (Nasdaq:VRSK) business, is headquartered in Boston with
additional offices in North America, Europe, and Asia. For more information,
please visit www.air-worldwide.com.
###
Media Contact:
Kevin Long
AIR Worldwide
klong(at)air-worldwide.com
617-267-6645
This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: AIR Worldwide via GlobeNewswire
Unternehmensinformation / Kurzprofil:
Datum: 19.09.2016 - 16:24 Uhr
Sprache: Deutsch
News-ID 495608
Anzahl Zeichen: 6301
contact information:
Town:
Boston
Kategorie:
Business News
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