This year is one for the catastrophe record books, insurance officials said yesterday, describing 2011 as the "year of the tornado."
The number of thunderstorms and their damaging sidekicks -- hail and twisters -- has been rising rapidly for 30 years in the United States. But the first half of 2011 is threatening to push this year into first place for financial losses, which reached $23.6 billion from thunderstorms. That's a new record for any year between January and June.
Forty-three major thunderstorms occurred during that period, releasing nearly 1,600 tornadoes in the central, southern and eastern United States. Half of those twisters happened in April, and 226 of them struck on a single day, April 27 -- setting two new records in catastrophe circles.
"We are literally rewriting the economic and financial history of disasters on a global scale," Robert Hartwig, chief economist and president of the Insurance Information Institute, told reporters on a conference call hosted by the global reinsurer Munich Re.
If bundled together, the damage from this year's spring tornadoes would become the ninth-costliest catastrophe in world history, and the fifth-most expensive event in U.S. history, Hartwig said.
That means the accelerating pace of seasonal thunderstorms now matches the ferocity of a landfall hurricane. Damage from the spring twisters surpassed losses from historic hurricanes Hugo in 1989, Charley in 2004 and Rita in 2005.
The number of thunderstorms is rising with other kinds of catastrophes. There were about 60 natural disasters worldwide in 1980, compared to 247 events last year -- a record. Thunderstorms are a key contributor to that rise, because they account for a majority of disasters.
Financial losses from storms have set new records in the United States for the past three years. That has driven some major insurance companies, like Allstate Insurance Co., to permanently reorient their exposure to loss from more frequent storms.
'The climate has changed'
The reasons behind the three-decade rise in disasters are multiple. Many experts point to the growing number of people and infrastructure in the path of storms as a key cause for growing losses. Also, the effect of La Niña -- which punctuates the collision of cooler and warmer air over the United States -- has agitated rougher weather this year.
But neither of those answers fully explains the catastrophe increases, says Peter Hoppe, head of Munich Re's Geo Risks Research. He says climate change is affecting storms.
When the role of new homes from rising population is removed from the accelerating trend in losses, a signal from climate change can be detected as a cause of stronger and more frequent storms, Hoppe said. That climate signal amounts to a 2.4 percent increase in insured U.S. losses since the early 1970s.
"We have an indication that the climate has changed in the sense that there's more days per year in which these big thunderstorm systems can develop," Hoppe said.
He also pointed to a German study that used global and regional climate models to predict that storm losses there will increase by 25 percent over the next 30 years because of global warming.
"So there is a clear signal that climate change here in Germany ... will contribute to intensification of such events," Hoppe said.
Some U.S. insurers are seeking a better understanding of climate change by asking scientists and modelers to develop more detailed tools to gauge local impacts soon, rather than in the distant future. Others are responding to the persistent rise in damages without waiting for proof about its cause -- like Allstate, which has seen its catastrophe losses quadruple over several years.
And other companies are bound to follow along, Hartwig said, as the years-long trend of destruction continues.
"So we are in the midst of a very long-term trend. Whatever the underlying causes are, this is pushing up the cost of providing insurance in many parts of the country," he said. "Insurers have begun to reflect that in their rates."
Correction: A previous version of this story incorrectly quoted Peter Hoppe about the impacts of climate change on thunderstorms in the United States. He believes the future increase in storm strength and frequency projected for Germany will also be seen in America.
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