As natural disasters have risen, so have insurance claims. That being the case, insurance companies are noticing trends that most of us are missing. True some of the increased damage is due to the increase in suburbs and development, but not all of it.
According to Scientific American, this past year saw an increase in natural disasters in the United States. There were 247 blizzards, thunderstorms and floods. The total number of such disasters in 1980 were 60. There has also been an increase in “meteorological disasters”. In 1980 there were a little over 50 damaging storms. In 2010 that number had climbed to 150.
Yes, some of the increase is due to urban sprawl. People now live in places where disasters might have occurred previously but no one was paying attention. With people moving into areas previously unoccupied, disasters in those areas are now being felt by insurance companies as well as the insured.
One such example is the amount of devastation that occurred only from thunderstorms last year. That figure is $9 billion which is a 500 percent increase over 1980. The above $9 billion dollar figure does not include the losses from last winters snow storms, December’s snow storms and the California floods.
Munich Reinsurance has detected what seems to be a changing weather pattern.
But it’s likely that the number of strong storms involving rain, snow and hail is also rising because of warming temperatures, says Ernst Rauch, who heads the company’s Corporate Climate Center.
“We believe we see indications that weather patterns — so the frequency and intensity of convective storms — in some parts of the United States has already changed,” he said yesterday. “So we believe we have indications that climate change is already, at least to some extent, visible.”
But the increased number of disasters is not confined to the U.S. alone. Haiti’s earthquake caused $8 billion of damage. Russia experienced a heat wave so severe that 56,000 died before it was over. Pakistan endured devastating floods. Seven hundred people died in China’s floods last July. Altogether the past year saw 950 disasters world wide. The number 30 years ago was a mere 400.
The new year has already experienced two horrendous disasters with the floods in Australia and Brazil. The eastern United States has experienced a series of snow storms that have shut down airports and left businesses empty of both staff and customers.
The U.S. may be in for a worse year this year. Very few hurricanes and tropical storms actually made landfall last year. Our luck is not expected to hold for much longer. More tropical storms and Hurricanes are expected to hit the U.S. Global warming is increasing their intensity which increases the amount of damage they leave in their wake. Think Katrina.
Floods and droughts may also be on the rise.
Researchers say heavier downpours are already occurring in the United States. More moisture is able to build up in the warming atmosphere, and when it’s released, more falls to the ground. But the time between rainfalls might be longer, contributing to drought.
“If you pull more water out, it will take longer to recharge,” said Harold Brooks, a research meteorologist with the National Severe Storms Laboratory in Oklahoma. “That’s why we get both flood and drought [with climate change].”
While politicians bicker over the reality of climate change, insurance companies are dealing with its reality. As loss of life, property, business, and agriculture increases due to an increasing number of natural disasters, insurance companies are going to continue to see claims rise and payouts increase. The old adage is that “Money Talks.” Now it will be interesting to see if the U.S. Congress and other governments around the world, are willing to listen.
Wouldn’t it be interesting if the single most powerful lobbyist on the issue of climate legislation were insurance companies?
Photo: courtesy of PhysOrg.com