Drought conditions across western Canada during September were expected to cost the Alberta’s Agriculture Financial Services Corporation (AFSC) between $700 million and $900 million (US$525 million and US$675 million), according to Impact Forecasting, Aon Benfield’s catastrophe model development team. This corresponds to an economic loss exceeding US$1 billion on a national basis.
Impact Forecasting’s Global Catastrophe Recap report for September, released on Thursday, noted that drought conditions continued to intensify across western Canada during September “as a lack of rainfall wreaked havoc on agricultural interests. The province of Alberta was particularly affected, where a disaster was declared after more than 80% of farmers reported sustaining crop loss during the year.”
In the United States, forecast economic losses from California’s Valley Fire in September were more than US$1.5 billion, with preliminary insured losses estimated at more than US$925 million, the report noted. The fire, which occurred northwest of San Francisco, was the third-most damaging wildfire in the state’s history, killing four people and destroyed 1,958 homes and other structures.
The Butte Fire southeast of Sacremento was the seventh-most damaging wildfire in state history, killing two people, destroyed 475 homes and causing total estimated economic losses of US$450 million, with insurance losses expected to be above US$225 million, the report added.
With peak U.S. wildfire season in California having started in late September and lasting through early November, wildfires in 2015 have already caused more damage and financial loss in the U.S. than in any other year since 2007, Impact Forecasting added in a release.
“The severity of the September wildfires in California serves as a reminder of how costly the peril can be for the insurance industry,” said Adam Podlaha, head of Impact Forecasting, in the release. “With insurers facing more than US$1 billion in claims payouts for the Valley and Butte fires alone, it makes it the costliest year for the peril since 2007.”
• Officials in Indonesia declared 2015 as the worst year for wildfires since 1997, following a reported US$4 billion in direct and secondary economic losses from fires in Sumatra and Kalimantan;
• A magnitude-8.3 earthquake struck central Chile on Sept. 16, triggering tsunami waves and killing 14 people. Over one million residents were evacuated as economic losses neared US$1 billion;
• Extensive flooding affected portions of Japan, killing eight people and damaging or destroying 20,000 homes. Three large insurers in Japan estimated payouts of at least JPY30 billion (US$250 million); and
• Typhoon Dujuan struck Taiwan and China, killing at least three people in Taiwan and injuring hundreds of others. Combined economic losses were listed at US$680 million; insured losses were US$79 million.