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How Climate Change May Affect Hurricane Risk and Losses: AIR, Brookings, AXIS

2021-01-19 15:07:17
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By 2050, climate change-related weather events will have a meaningful impact on future hurricane losses, increasing them by 20% or more and doubling them in some cases, even without any increase in the concentration of coastal properties, new research estimates.

Catastrophe modeling agency AIR Worldwide (AIR), in collaboration with the Brookings Institution and AXIS Capital Holdings, has report to examine how climate change may affect hurricane risk in the United States by 2050, particularly in relation to financial losses to residential and commercial real estate.

The report examines future hurricane-induced storm surge losses for selected study areas around New York, Houston and Miami, as indicators of the added risk created by rising sea levels. The results of the analysis show that an increased frequency of events and sea-level rise will have a meaningful impact on future damage. The growth in the number of stronger and onshore storms in general increases modeled losses by about 20%, with slightly greater changes in areas such as the Gulf and southeast coasts where major landings are already more likely. Losses are also increasing inland as stronger storms can penetrate further from the coast.

The effects of sea level rise, using the storm surge analysis for New York, Miami and Houston, suggests that by 2050, sea level rise could increase storm surge losses by a third to a factor of nearly two, with greater consequences. possibly in combination with an increase in the number of severe storms.

Actual losses in 2050 may be higher; while the analysis keeps real estate exposure constant at its current level, exposure to the coast is currently growing at 4% per year and is likely to continue to grow.

While researchers believe climate change will affect hurricanes in multiple ways, the report highlights aspects: an increase in the frequency of the strongest storms and additional storm surge flooding due to sea-level rise.

The analysis is based on the AIR Hurricane Model for the United States, which takes into account wind, storm surge and flooding caused by precipitation, and the AIR property exposure database. AIR's model contains a catalog of simulated hurricane seasons, including multiple events of varying strength that made landfall along the Gulf and Atlantic coasts. The base catalog has been developed to reflect the current climate and AIR has created a new set of catalogs that reflect both the frequency and severity of changes due to the future climate.

"This analysis points to increased damage and losses from hurricanes without taking into account any changes in the concentration of properties along the coast," says Dr. Peter Sousounis, Vice President and Director of Climate Change Research, AIR Worldwide, a Verisk Company. “With more intense hurricanes coming ashore and storm surges from stronger storms atop higher sea levels, the results presented in this study are only the first step. Additional research on a broader range of effects is needed to gain a somewhat more complex picture, especially in relation to how risks can change geographically. "

Critical factors include whether the strongest storms become not only more frequent but also more intense; whether storms can stay stronger at higher latitudes; how much extra rain hurricanes can produce and whether the storms decrease on landfall and maintain their intensity longer after landfall. It is important to consider the full range of impacts on coastal and inland areas to determine how the population will be affected and how government policies could adapt to address what is likely to be an increasingly becoming insurance gap will be.

Bill Churney, president, AIR Worldwide, said this work follows related AIR research that takes into account the climatic impacts on atmospheric hazards responsible for the multi-billion dollar disasters that occur annually around the world: “The modeling tools and data provided in presented in this report could be expanded for additional hazards, including inland flooding, forest fires, and convection and extratropic storms, ”said Churney. "While there is considerable uncertainty about how extreme risk of events may develop in warmer climates, these models are a practical approach to assess the potential impacts."

“Climate-related risks are some of the most serious problems facing the world today and insurers play a vital role in mitigating them. Investing in ongoing research like today's, in collaboration with AIR and Brookings scientists, is essential, & # 39; & # 39; said Albert Benchimol, AXIS president and CEO.

Source: "Quantifying the Impact from Climate Change on U.S. Hurricane Risk" can be downloaded here: https://airww.co/climateimpact

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