Catastrophe risk modeling firm AIR Worldwide estimates that industry insured losses from Typhoon Hagibis, which made landfall in Japan on October 12, will be between $8 billion (JPY 865 billion) and $16 billion (JPY 1,730 billion).
According to AIR, more than half of the losses relate to inland flooding.
AIR’s modeled insured loss estimates include insured damage to property (residential, commercial, industrial, and agricultural/mutual), structures and their contents, as well as extra expenses and debris removal, and automobile damage from wind, storm surge, and inland flood.
The estimates do not include business interruption losses, loss adjustment expenses, demand surge nor do they include losses from landslide, tornado or earthquake, losses to land or infrastructure or contractors all risks and marine-related insurance losses.
(Demand surge is the increase in costs of materials, services, and labor due to increased demand following a catastrophic event. According to AIR, demand surge can be applied by AIR software users who want to account for this variable.)
AIR said that Typhoon Hagibis made landfall with one-minute sustained wind speeds of about 90 miles per hour—the equivalent of a Category 1 hurricane—on the main Japanese island of Honshu on Saturday, Oct. 12, near Shizuoka on the Izu Peninsula. The storm delivered high winds and record-breaking precipitation to a large portion of Honshu from Mie Prefecture in the west to Iwate in the north. Storm surge raised sea levels by more than 1 meter above mean sea level along parts of the coast.
The Japan Meteorological Agency (JMA) issued its Level 5, or highest level, special warning for heavy rain. Unprecedented rainfall followed, with a wide swath of Honshu (just outside the Tokyo metro area) seeing between 10 and 20-plus inches of rain. The resort town of Hakone, a record-breaking 37 inches in one day.
Many regions received between 30-40 percent of their yearly rainfall in just two days, with more than 100 stations breaking daily rainfall records at those locations.
In addition, shortly before Hagibis made landfall, a magnitude 5.7 earthquake struck the region—parts of which were in the early stages of recovery from Typhoon Faxai, which struck just one month prior.
Much of central and eastern Japan experienced severe flooding and landslides; power outages and travel disruption were widespread.
AIR noted that costs of repair and cleanup, as well as business interruption losses for commercial and industrial properties, may be elevated as a result of the fact that much of the floodwater has a high mud content and lots of debris—a consequence of such intense rainfall within a short time period.
Source: AIR Worldwide