Tag Archives: China

The 2015 Northwest Pacific Typhoon Season: Already a Record-Breaker

While the Atlantic hurricane season is expected to be below average this year, the North Pacific is smashing records. Fuelled by the strengthening El Niño conditions, the Accumulated Cyclone Energy (ACE)—used to determine how active a season is by measuring the number of storms, their duration and their intensity—continues to set unprecedented highs for the 2015 season.  According to Dr. Philip Klotzbach, a meteorologist at Colorado State University, the North Pacific ACE is 30% higher for this time of year than at any other time since 1971.

Philip J. Klotzbach, Colorado State University

To date, there have been 12 named Northwest Pacific storms, of which three have strengthened to Category 5 super-typhoon status, and two have strengthened to Category 4 typhoon. Typhoon Maysak was the first of the super-typhoons to develop and is reportedly the strongest known storm to develop so early in the season—it eventually passed over the northern Philippines in late March as a tropical depression. Super-Typhoons Noul and Dolphin followed in quick succession in May, with Noul scraping the northern tip of the Philippines, and Dolphin tracking directly in-between the islands of Guam and Rota.

China is recuperating after getting hit by Typhoons Linfa and Chan-Hom only days apart. Linfa made landfall on July 9, bringing strong winds and heavy rainfall to Hong Kong and southern China’s Guangdong province. Two days later, Chan-Hom brought tropical storm-force winds and heavy rainfall to Taiwan and the Japanese Ryukyu Islands before briefly making landfall as a weak Category 2 storm over the island of Zhujiajian in the Zhejiang province. Prior to landfall, Chan-Hom was anticipated to pass over Shanghai, but swung northeast and missed China’s largest city by 95 miles. Despite this near-miss, Chan-Hom still stands as one of the strongest typhoon to have passed within 100 miles of the city in the past 35 years.

Typhoon Nangka, the first typhoon to hit Japan this season, intensified to a Category 4 storm before ultimately making landfall as a Category 1 storm over the Kochi Prefecture on Shikoku Island, Japan. Although Nangka’s strength at landfall was weaker than originally forecast, the high level of moisture within the system caused significant rainfall accumulations, leading to widespread flooding and the threat of landslides. While there was an initial fear of storm surge in Osaka Bay, there has been limited damage reported.

This record-breaking season has been strongly influenced by the strengthening El Niño conditions, which can be characterised by several physical factors including warmer sea surface temperatures, a higher number of Category 3-5 typhoons, and a greater proportion of typhoons that follow recurring or northward tracks—all of which have been evident so far this year.

With El Niño conditions expected to continue intensifying the storms to come, this season highlights the necessity for a basin-wide multi-peril model, connected through an event-based approach and correlated geographically through a basin-wide track set. These will be featured in the new Japan typhoon model, due out next year, followed by the South Korea and Taiwan typhoon models. The RMS China typhoon models currently models typhoon wind, inland flood and surge for a correlated view of risk.

As El Niño conditions continue to bolster the Northwest Pacific typhoon season, RMS will be monitoring the situation closely. In September, RMS will be releasing a white paper on ENSO in the West Pacific that will provide further insight into its affects.

How is the 2014 North West Pacific Typhoon Season Shaping Up?

July’s Typhoon Matmo was the 10th named typhoon of 2014 and the 5th to make landfall in the West Pacific basin. Typhoons can occur throughout the year, but the peak of the season is July through October, when nearly 70 percent of all typhoons develop, so we expect to see more activity in the region in the coming months.

Let’s take a look at recent activity and typhoon risk in China, the Philippines, Japan, and Taiwan.


To date, China has been impacted by three landfalling typhoons in 2014, the strongest of which was Rammasun, a Category 4 strength storm, with maximum sustained winds of 135 mph impacting Hainan and Guangdong provinces, and the autonomous region of Guangxi.

The southeastern coastal provinces of Guangdong, Fujian, and Zhejiang are most vulnerable to landfalling typhoons. They also represent some of China‘s most economically developed areas. Typhoon Rammasun impacted Guangdong province in July, bringing damaging wind and heavy rain. Overall in China, typhoon-induced flooding is the biggest driver of risk in high-exposure areas such as Guangdong, driving approximately 80 percent of the average annual losses from typhoon.

Insurance penetration is extremely low in China, varying by province. On average, about 15 percent of residential property risk is insured. Hainan, where Typhoon Rammasun first made landfall, has one of the lowest insurance penetrations in China, while Guangdong, one of the more prosperous provinces, is the second largest province for property insurance purchases with 41.7 billion Yuan ($6.8 billion) in direct premiums in 2012, according to the China Insurance Regulatory Commission.


Typhoon activity kicked off early this year in the Philippines with Tropical Storm Kajiki in January. More recently, the second storm to make landfall was Typhoon Rammasun, which hit Legaspi City in the Albay Province, south of the capital Manila, as a Category 3 storm. In a 36-hour period it brought 11.6 inches of rainfall, leading to flash flooding and landslides. The provinces impacted by Rammasun contain over $180 billion of insurable commercial and industrial building exposure, and over $215 billion of residential building exposure.

Like China, the Philippines lags behind some other markets in Asia in relation to insurance expenditure – non-life insurance penetration is 0.09 percent – though with higher proportionally for commercial and industrial businesses, which are centred around Manila and the industrial zones.


Tropical Storm Neoguri made landfall over the Kumamoto Prefecture on Kyushu Island in southwest Japan as the country’s first landfall this season. Neoguri brought strong winds, heavy rains, flooding, landslides, and mudslides to parts of southwest Japan. On Kyushu, the city of Ebino reported 13 inches of rain in the first 24 hours, and on Okinawa, heavy rainfall triggered flash flooding.

The southwestern parts of the country are the most vulnerable, particularly Shikoku, Kyushu, and San-in. Tokyo is rarely hit by typhoons and much of the coastline is protected from by the tsunami walls designed to protect from a four-meter storm surge.

Japan is the second largest non-life market in gross premium terms behind the U.S., and there is relatively high penetration of personal lines insurance, with over 50 percent of households buying building insurance. However, corporate Japan is massively under-insured compared to its western equivalents. Many large corporations only insure their property on an indemnity basis, while many small to medium-sized enterprises are completely uninsured.


So far this season, Taiwan has only been impacted by Typhoon Matmo, which passed through the center of the country as a Category 2 storm, bringing heavy rain and strong winds.

Storms typically travel towards the northwest from the Philippines, losing speed when they encounter the mountain chain running north-south down the center of Taiwan, and dropping most of their rain on the eastern side, causing rivers to overflow due to the extra water runoff from the mountains.

The most dangerous typhoons are those that approach from the south. The north-south mountain chain funnels them north up the Taiwan Straits so that they hit the western and northwestern parts of the island, including Taipei, where large industrial and commercial exposure is situated, such as the Hsin Chu Industrial Park in the province of Hsinchu which reportedly has a combined property/business interruption accumulation of $33.33 billion. However, insurers have reported few insured losses arising from wind damage alone, as the main damages are a result of flooding. Most of the losses caused by typhoons in Taiwan are agricultural, and thus uninsured. Insurance penetration is very low compared to some other markets in South East Asia in relation to insurance expenditure, with insurance penetration for non-life at 0.08 percent.

Rammasun is One of the Strongest Typhoons to Hit Southeast China in Recent Years

RMS closely monitored typhoon Rammasun last week as it picked up strength en route to the Philippines. The world also watched, remembering the catastrophic damage typhoon Haiyan caused last November. While Rammasun did not wreak as much havoc as Haiyan, it still left a trail of damaged buildings and flooded crop fields in the Phillipines, southeast China and Vietnam. Below, RMS looks at the property damage and insurance industry implications as the typhoon hit both denser commercial metropolitan areas and agricultural provinces.


RMS reports that on Friday, July 19 Super typhoon Rammasun, one of the strongest to hit southeast China in recent years, made three landfalls in the provinces of Hainan, Guangdong, and Guangxi.

Rammasun has significantly impacted the Philippines, southeast China and Vietnam. Rammasun brought strong winds, heavy rain, and storm surge to some coastal areas with close to 300,000 buildings damaged in the affected countries.

In China, damaging wind and floods have destroyed at least 37,000 homes and ravaged 468,500 hectares of crops in Hainan, Guangdong and Guangxi provinces. Virtually all brick-and-tile houses in the town of Wengtian, Hainan were either destroyed or had their roofs removed. Within a 24 hour period up to 15 inches of rain fell in the city of Haikou; the week before Rammasun hit, the southeastern provinces were reportedly experiencing heavy floods, which have only been exacerbated by the typhoon.

“Typhoon-related flood, which includes both rainfall driven and coastal flooding, contributes as much as 80% to typhoon average annual loss in China, with the coastal provinces driving the loss,” said Nikki Chambers, hazards scientist at RMS. “July to October are the most active months for typhoons in this region. On average 6 typhoons make landfall a year in China and typhoon Rammasun highlights the importance of accounting for all sources of typhoon losses, of which flood is the main driver.” Insurance penetration is extremely low in China particularly for residential risk, slightly higher for commercial and industrial lines of business. On average, about 15% of property risk in China is insured. Insurance penetration varies by province; Hainan has one of the lowest insurance penetrations in China. Guangdong is one of the more prosperous provinces; it is the second largest province for property insurance purchases, with 41.7 billion yuan (US$6.8 billion) in direct premiums for property insurance in 2012, according to the China Insurance Regulatory Commission.


The typhoon wreaked havoc earlier in the week in the northern Philippines, which is still rebuilding after Typhoon Haiyan. Rammasun made its first landfall in the largely agricultural provinces south of the capitol Manila, leaving 94 people dead, and over 111,000 houses damaged, of which nearly 28,000 have been totally destroyed and 83,000 have been partially damaged., Based on analysis from the RMS Philippines Economic Exposure Database, the impacted provinces in the Philippines from Rammasun contains over 100 bn USD of insurable commercial building exposure, 80 bn USD of industrial building insurable exposure, and over 215bn USD of residential building exposure. Based on the RMS Philippines industrial cluster catalog, industry is clustered around metro Manila and in areas to the north and south of the capital in Central Luzon, which are located within the affected area of Rammasun. The insurance penetration rates in the Philippines is relatively low, though higher for commercial and industrial lines of business and will be centred around Manila and the industrial zones.


In northern Vietnam, Typhoon Rammasun made landfall Saturday morning, causing heavy flooding. At least eight people have died and it has affected more than 6,000 homes. The typhoon has damaged 3,300 hectares of rice and other crops and disrupted traffic in the region. Typhoon, Matmo, with maximum winds of 150km/h, is now threatening the area ravaged by Rammasun. RMS is monitoring the situation closely.