Weather Damage

Weather Damage

Days with destructive wind, lightning and floods are the times when ‘Mother Nature’ shows her bad temper. In a matter of minutes, her fury flattens whole neighborhoods, towns or regions. Millions lose their homes and belongings every year. Some lose more than their possessions. Violent weather takes away the lives of thousands worldwide. Hurricane Mitch alone was responsible for the death of over 10,000 Hondurans in 1998. On the average, about 50 Australians and over 1,000 US citizens die every year as a direct consequence of extreme weather events. The figure is likely to be much higher, however, because the cause of death is not always easily attributed to weather events.

large_hail_stoneThe economic impact of destructive winds is, to some degree, more tangible. When a tornado or a cyclone ravages a town, an assessor estimates the replacement cost of homes and contents and the damage to the town’s infrastructure. Not quite as easy is the assessment of secondary impacts, such as the temporary provision of shelter and food, long-term revenue shortfalls, reduced business activity etc.

Canada had a disastrous year in 1996. Violent weather caused more than A$5 billion worth of damage. Secondary impacts were estimated to exceed A$6 billion. More recent weather events are directly responsible for annual economic losses of over A$30 billion in the US. The figure does not include the significant impact of extreme heat or cold.

Transport is usually the first to suffer. A tropical cyclone or tornado warning stops public transport. The ensuing loss of revenue and possible accidents can reach several million dollars. Rain, snow and ice on roads cause fatalities and injuries every year. Insurance companies receive thousands of weather-related car insurance claims. Whether you are on a small pleasure craft or a large ferry, being on sea during violent storms is asking for trouble. Mountainous waves may capsize a seagoing vessel of almost any size.

No other transport system is as dependent on weather as aviation. Strong winds, clear air turbulence, reduced visibility, icing, snow etc. cause cancellations or diversion of flights. The Air Transport Association estimates an annual weather-related loss of revenue of around A$540 million for its 26 member airlines.

severe_thunderstormThe weather is never perfect for farmers. Too much rain and the soil washes away or the crops rot; not enough rain and the plants wilt. Hail damages the plants and makes fruit and vegetables non-saleable. Strong winds flatten the crops. The US vegetable processing industry estimates a weather-related loss of over A$80 million per year. You are not a farmer? You still have to pay, though, as the market prices skyrocket after natural disasters.

While we talk prices, violent weather dictates the amount of money you pay for your property insurance. That is, if you can get a policy. You probably won’t go far with your application if you live in a flood-prone area. Alternatively, the insurance premium is very high in areas with high incidences of extreme weather events, e.g. floods, cyclones or tornadoes. Several billion dollars worth of damage comes quite naturally to a good-sized tropical cyclone.

You still aren’t off the hook. As a taxpayer, you support the victims of disasters. Several government emergency agencies provide one-off payments or loans to their own citizens or to the people in disaster areas of other countries. In the long term, governments spend large amounts rebuilding damaged roads and public buildings.

What does the future hold? The insurance companies bet on massive increases in weather-related catastrophes. They cite two reasons: population growth and global warming. Popular waterfront areas, such as the southeast coast of the US or the northeast coast of Australia, have grown rapidly in population and will continue to grow. Emergency agencies and insurance companies know that one day a ‘big one’ will hit a major town, causing immense damage. Scientists claim that global warming will multiply and intensify extreme weather events.

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