From the Editor's Desk
The New Storms
From the Editor’s Desk: A California wildfire was last year’s biggest insured catastrophe loss. While hurricanes are a perennial threat, how long before a cyberattack tops the list?
- Patricia Vowinkel
- June 2019
June marks the start of the hurricane season and these storms, with their destructive winds and heavy rains, almost always rank as one of the top insured losses each year.
Last year, however, the Camp Fire in California, which destroyed most of the town of Paradise in northern California, was the biggest insured catastrophe loss, estimated at more than $12 billion.
That was more than the estimated $10 billion insured loss from Hurricane Michael, the first hurricane to make landfall in the United States as a Category 5 since Andrew in 1992.
Insured losses from Typhoon Jebi, which hit Japan in September, meanwhile, have been creeping higher and are now estimated at about $10 billion as well, with the potential to go even higher.
Wildfires had previously been considered a “second-tier” catastrophic event, not on the plane of hurricanes and earthquakes, according to Matthew Mosher, AM Best executive vice president and chief operating officer. But the blazes of 2018 and 2017 changed that. While hurricanes and wildfires were among the top insured losses last year, other storms are brewing.
Cyberattacks, for instance, are a growing concern. Insured losses from the NotPetya malware attack in 2017 were estimated at about $3 billion, just a little less than the $4.5 billion insured loss from last year's Woolsey Fire in California.
June is Catastrophe Awareness Month and in this issue Best's Review looks at some of the catastrophe risks insurers, risk modelers, businesses and homeowners have had to consider lately.
In “Going Dark,” Best's Review examines the NotPetya malware attack and the growing threat of cyber catastrophes.
While wildfires captured many of the headlines in 2018, volcanoes also made their presence known, spewing ash, toxic gases and lava. Mt. Kilauea in Hawaii and Mt. Etna in Italy were just a few of the volcanoes that erupted in 2018.
In “Waiting to Erupt,” Best's Review looks at last year's volcanic eruptions and how insurers are responding.While insured losses from these events are typically low, the industry has been working on ways to improve coverage.
Massive flooding in the Midwest earlier this year has been a devastating catastrophe. An AM Best report, Blizzards, Heavy Rains, Melting Ice Produce Catastrophic Midwest Flooding, examines this event.
Despite the magnitude of the potential losses, these catastrophes are usually insurable. At the personal level, however, people with chronic conditions often have not been able to get life insurance. In “Reaching the Uninsurables,” Best's Review looks at how life insurers are now working to provide coverage for people with conditions such as diabetes.
On the economic front, asset managers are preparing for a different kind of storm. To find out more about how asset managers are preparing their portfolios, check out “Storm Clouds on the Horizon?”
To read these and other features online, go to www.bestreview.com.