The trend of above-average hurricane seasons is expected to continue this year and Canadian insurers should heed this warning by preparing Atlantic businesses for more severe hurricanes, according to Allianz Global Corporate & Specialty’s Atlantic Hurricane Season Outlook 2022.
“Although Canada is not typically impacted by severe hurricanes, the unpredictability and severity of extreme weather events means that companies in all regions across Canada should prepare again this year,” says Bernard McNulty, chief agent of AGCS in Canada in a written statement to Canadian Underwriter.
“We understand the Canadian Hurricane Centre responds to three or four storm events each year with at least one of those causing onshore damage. Along these same lines, we also see the threat of climate change shifting up to #3 in our annual Risk Barometer due to the broad impact it has across Canada, triggering not only storms but heat waves, forest fires and flooding.”
The 2021 hurricane season was the third most active on record and the sixth consecutive year that the Atlantic hurricane season was above average.
There was a total of 21 named storms, seven of which were hurricanes or major hurricanes (category three or higher).
The main factors contributing to last year’s above-average hurricane season include La Niña (the periodic cooling of ocean surface temperatures in the central and east-central equatorial Pacific), above-normal sea surface temperatures (SSTs) early in the season, and an above-average West African Monsoon rainfall, according to the report.
Although the Atlantic basin’s hurricane season officially starts today, recent Atlantic hurricane seasons have seen the first tropical storms forming as early as April or May.
While there’s no clear consensus on whether manmade climate change is increasing hurricane frequency, experts largely agree that storms and hurricanes will intensify, causing more physical damage.
However, there are ways to minimize losses in the event of a hurricane.
“Businesses need to develop and implement a comprehensive crisis plan, including actions to take before, during, and after a storm,” reads the report.
“Loss can be greatly minimized by adequate preparation before a storm arrives. The development and implementation of a comprehensive windstorm emergency plan should be a number one priority for those companies who don’t already have this in place,” says Thomas Varney, head of risk consulting, North America, at AGCS in a press release.
AGCS advises businesses in exposed areas to regularly update their emergency plan—which should cover areas such as training, assembling emergency supplies, business continuity, buildings inspections, anchoring or relocating equipment and stock—and protecting windows.