Canadian Underwriter

How much did December’s ‘bomb cyclone’ cost Canadian insurers?

January 5, 2023   by Jason Contant

Houses along the shores of Lake Erie following December's 'bomb cyclone'

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The ‘bomb cyclone’ that ripped through eastern Canada during the holiday season has been declared a catastrophe, Catastrophe Indices and Quantification Inc. (CatIQ) confirmed to Canadian Underwriter Thursday.

The winter storm brought heavy snowfall, strong winds and blizzard conditions to much of North America between Dec. 21 and Dec. 26, Aon said in its weekly Cat report released Dec. 30.

In Canada, the storm was declared a Cat in the provinces of Ontario, Quebec, New Brunswick, Nova Scotia and Prince Edward Island, said CatIQ president and CEO Laura Twidle. This means insured damages were more than $30 million (up from the previous Cat threshold of $25 million).

“The bomb cyclone that hit much of eastern Canada over the holidays was quite interesting, as it was a spatially huge storm with the lower end in the southern states and the upper end up into much of the ‘right side’ of Canada,” commented Glenn McGillivray, managing director of the Institute for Catastrophic Loss Reduction (ICLR).

“It effectively made for a conveyor of water that delivered a mixed bag of precipitation depending on timing and where you live. People experienced everything from straight rain, to freezing rain and snow and almost everything in between.”

In Fort Erie and Port Colborne, near Lake Erie, Ont., photos of ice-covered lakefront homes circulated on social media and even attracted ‘tourists’ looking to see the frozen homes, media reports said.

“The problem is people are travelling to see them on roads that still have deep snow and closures,” the Niagara Regional Police Service tweeted on Dec. 28. “We have cars getting stuck & people walking on unsafe lake ice. Stay home — stay safe.”

McGillivray said one of the disconcerting things about the storm was how people disregarded warnings not to travel by weather forecasters and police. “This was a well-forecasted event. We had a very good idea of what was going to happen, when and where.

“Yet people insisted on travelling, particularly by road, and many people were left stranded,” McGillivray said. “Some communities, like Chatham-Kent, had to declare states of emergency because of all the stranded motorists. These bad decisions put travellers and first responders at great risk. People must take these warnings more seriously.”

The Canadian Press reported about 50 stranded customers and 48 staff spent the night at a Walmart store in Chatham-Kent in southwestern Ontario, with staff blowing up air mattresses for people to sleep on and serving hot meals from the store’s deli. The municipality on the northwestern shore of Lake Erie also reportedly saw multiple vehicle crashes, with motorists abandoning their vehicles on the roads.

The storm caused power outages for about 1.1 million people in Quebec (670,000) and Ontario (430,000), according to Aon’s Cat report. At least 200 flights were cancelled at Vancouver International Airport, where nearly a foot of snow fell on Dec. 22. Downtown Vancouver also saw 30 centimetres of snow.

The storm was particularly devastating in the U.S., where 89 people died, and more than 20,000 flights were cancelled or delayed. “More than 60% of the American population was under some degree of winter weather alert,” Aon said in its report. Buffalo saw the longest blizzard in the city’s recorded history (37.5 hours), and numerous states declared emergencies.

Modelling firm Karen Clark & Company estimated U.S. insured losses from what was unofficially called Winter Storm Elliott to be $5.4 billion across 42 states.


Feature image: Houses along the shores of Lake Erie, near Fort Erie, Ont., remain covered in ice Tuesday, December 27, 2022, following a winter storm that swept through much of Ontario. THE CANADIAN PRESS/Nick Iwanyshyn