Archive for the ‘AIR Worldwide’ Category

AIR Worldwide Updates Estimates of Insured Value of U.S. Coastal Properties

June 7, 2013 Comments off

AIR Worldwide Updates Estimates of Insured Value of U.S. Coastal Properties

Source: AIR Worldwide

Catastrophe modeling firm AIR Worldwide has released an update to its “The Coastline at Risk” report. The update presents and discusses AIR’s most recent estimates of the insured value of residential and commercial properties in states along the Eastern Seaboard and Gulf Coast of the United States.

While above-average sea surface temperatures in the last nearly two decades have elevated hurricane activity in the open Atlantic, there is a far more certain driver of U.S. hurricane risk that the insurance industry faces. It is the continuing increase in both the number of insured properties in areas of high hazard and the replacement value of those properties. AIR estimates that 38% of the total exposure in coastal states is currently located in coastal counties of hurricane states, which accounts for 16% of the total value of properties in the entire U.S.

Other highlights from the report include:

• The estimated insured value of residential and commercial properties in just the coastal counties of the U.S. East and Gulf Coast states now exceeds $10 trillion. The estimated value of these properties in the coastal counties of the states of Florida and New York alone totals nearly $3 trillion in each state.

• Over the past five years, the insured value of properties in coastal states increased at a compound annual growth rate of near 4%. While the severe economic recession of the last five years has resulted in slower growth than the historical average, there are signs that new construction is picking up once again.

• New York edges out Florida as the state with the highest estimated property replacement values, at $2.9 trillion; but Florida has the largest proportion—79%—of its insured value located in coastal counties.

Climate Change and U.S. Severe Thunderstorm Risk

September 23, 2011 Comments off

Climate Change and U.S. Severe Thunderstorm Risk (PDF)
Source: AIR Worldwide

The United States is particularly susceptible to severe thunderstorm outbreaks. No other country experiences as many and as intense thunderstorm cells in a typical year. When all of the contributing conditions come together—atmospheric instability, moist warm air, and a mechanism capable of lifting the air and releasing its latent heat—the risk is clear.

The latest research on the influence of climate change points in two conflicting directions and further study is needed for scientists to be able to reach a consensus. In the near term—which may extend for decades or longer—which of the competing factors “wins out” may change from one year to the next, making it nearly impossible to attribute specific changes in the hazard to changes in climate until a very long and dependable historical record becomes available.

What is clear, in the United States and in most parts of the world, is that people are moving to and building homes in areas of higher risk. In comparison to climate impacts, these trends are more easily quantified and can more readily explain some part of the upward trend in losses.