Tropical Cyclone Debbie arrived in northern Queensland, Australia earlier this week. Ravaging winds and massive storm surge ran aground as the storm made landfall near Airlie Beach, north of Prosperine, during the middle of the day on Tuesday, March 28.
At its peak, Debbie reached 195km/h (120mph) using the 10-minute sustained wind averaging, which ranks it as a Severe Tropical Cyclone, according the Bureau of Meteorology’s (BoM) storm classification system, and a category 4 storm.
As the storm approached, highest gusts of 263km/h were recorded at Hamilton Island. Along with the strong winds, torrential rains fell accumulating more than 200mm over 24 hours in many places, causing flash floods, and storm surge has led to widespread coastal flooding. The slow-moving nature of the storm has also amplified the potential for damage.
The storm affected a fairly sparsely populated part of the coastline, but nevertheless, some agricultural interests and large hotels were in the firing line. Coastal towns and a few small cities along were affected, with over 48,000 homes losing power across Bowen, Mackay and Whitsunday.
The storm has since eased and transitioned to become an extra-tropical cyclone, but continued to bring heavy rainfall across much of Queensland. The “phenomenal” accumulations of rain have caused dams to overflow to the west of Mackay, according to media sources.
The Insurance Council of Australia (ICA) declared the Severe Tropical Cyclone Debbie a “catastrophe” on Tuesday, and that it’s too early to accurately gauge the extent of the damage, before the anticipated many thousands of claims start to arrive in the coming days.
Cyclone Yasi, the ICA noted, struck an even less populated area to the north back in February 2011 as a stronger category 5 cyclone, and caused insured losses of around $1.4bn. Debbie is likely to be higher than this amount. Since 2006, insurers have paid out $3.6bn due to cyclone related events, and over $3.2bn caused by flooding.
The “live cat” market also showed signs of stirring. Comments from the ICA and the ferocity of the developing storm no doubt sparked interest in industry-linked securities (ILS) and reinsurance broking communities, according to Artemis.bm, with enquiries about industry-loss triggered products to hedge exposed portfolios. While it looks certain for reinsurance layers to be activated by the volume of claims hitting the primary market, reinsurance companies have been enquiring about retrocessional coverage.
Slow to wake
It’s been a stuttering tropical cyclone season across Australia so far, however, there has been plenty of potential. Numerous areas of low pressure have formed through the season (which runs November 1 to April 30 the next year) but few have become full-blown tropical cyclones, due to one or two missing components from the required atmospheric set-up. Out of 27 weak low-pressure “seeds,” only five have grown into tropical cyclones:
- and now Debbie
None of the rest achieved a strong enough wind speed (>63 km/h) to be classified as a named tropical cyclone. With only a month left of the 2016-2017 tropical cyclone season for Australia, it seems unlikely that we’ll reach the average of 11 tropical cyclones across the region.
In October last year, seasonal forecasts were predicting an increased chance (about two-in-three) of more than the average number of tropical cyclones, due to an expectation of weak La Niña or neutral conditions. This still leaves a one-in-three chance of fewer than normal tropical cyclones.
The high number of low-pressure areas this season shows that the atmosphere has been showing strong potential for storms. However, despite their power, tropical cyclones are easily discouraged when environmental conditions are less-than-perfect, leading to the dearth of significant storms.
Ultimately, seasonal forecasting months ahead is a game of probabilities, in contrast to the more deterministic (single outcome) nature of most short-term everyday weather forecasts.
For more information on seasonal forecasting, a previous blog describes some of the differences between seasonal forecasts and normal weather forecasts, and we have a guest blog by our Willis Research Network Fellow Dr James Done of the National Center for Atmospheric Research.
Back with a vengeance
This season’s low number of named storms follows an even quieter season in 2015-2016, which saw only 11 weak tropical low pressure areas (potential tropical cyclones) which turned into only three fully-fledged tropical cyclones—in fact this was the least active season on record.
Seasonal probabilistic forecasts issued for last season by the Bureau of Meteorology were indeed calling for fewer than average tropical cyclones, due to the strong El Niño conditions that were at play in the tropical Pacific Ocean.
As the season enters its final month, Severe Tropical Cyclone Debbie is a clear reminder of the ferocity of nature. There is still plenty of heat in the ocean, which can help sustain and develop areas of low pressure, so checking that you are happy with your insurance policy conditions and coverage is advised, while making sure making sure you have an emergency/evacuation plan if you live in a prone area.
Tropical cyclones in the future
In the context of climate change, there is much debate and uncertainty about how storm frequency and severity will change in the future. There are some indications that although we may not see more frequent storms, when they do occur, they could be more severe.
In addition, there are many ways in which the impacts of future climate change may increase the damage from tropical cyclones, for example through increased rainfall and flooding, or higher storm surge due to sea-level rise.
As our towns and cities grow, especially in prime coastal regions, our exposure and vulnerability increases. The insurance industry will play a key role in providing financial resilience and assisting recovery efforts from extreme events in the future. By staying on the cutting-edge of science through initiatives such as the Willis Research Network, the insurance and risk consulting industry can help to provide the analytical expertise to appropriately quantify and manage catastrophe risks.