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“Horror and confusion seized upon all, whether on shore or at sea: no pen can describe it; no tongue can express it; no thought conceive it…”

Those were the words of Daniel Defoe in “The Storm”, which he published the year following the great 1703 windstorm, an event that saw it’s 310th anniversary on December 7. This event truly was a great storm, estimated to be one of the strongest windstorms to impact the UK.

Innovative Windstorm Data Model

RMS performed an innovative footprint reconstruction and estimates that wind speeds up to 110 mph were experienced across an area the size of greater London. These speeds are 30-40 mph stronger than those brought to the UK recently by windstorm Christian and are comparable to a category 2 hurricane. Such speeds can cause considerable damage, particularly to inadequately designed and constructed properties.

January also sees the 175th anniversary of the Irish “Oiche na Gaoithe Moire”; which is “The Night of the Big Wind” for those who don’t speak Gaelic.

Reports of the precise meteorological characteristics of this storm are unclear, but analyses of the event estimate that wind gusts in excess of 115 mph occurred and maximum mean wind speeds could have reached 80 mph. At the time it was considered the greatest storm in living memory to hit Ireland and its intensity may not have been rivaled since.

However, other than an interesting history lesson, is there anything valuable to note from these events from an insurance industry perspective?

Both events were severe European windstorms, causing significant widespread damage, but both would also be significant today.

Hubert Lamb’s unique study analyzing historic European windstorms over a period of 500 years places these events in the top grade of severity, at number 4 and 6 in his severity index and RMS estimates that a reoccurrence of the 1703 storm would cause an insured loss in excess of £10B ($16B).

A feature of both events at the time was the extensive and widespread damage to roofs. The 1703 event left tiles and slates littering the streets of London and the 1839 event caused parts of Dublin to look like a “sacked city”.

Roof damage was in part due to poor construction, lack of maintenance and inadequate design for the wind speeds experienced. This is a significant consideration today. Across Europe, design codes in relation to wind damage vary significantly and are a key source of uncertainty when modeling wind vulnerability.

Similar risks and construction types can perform quite differently comparing the north and south of the UK or Ireland. Properties further north experience higher wind speeds more frequently and are generally better prepared. Historically adopted construction practices and older buildings that pre-date many of the building codes and design guidance existing today further complicate the issue.

Another feature of both events were the extents of severe damage, which led to inflated repair costs due to the demand for materials and labor. These were early examples of what we now refer to as post-event loss amplification (PLA). From an insurance perspective we consider inflated “economic” costs (i.e. temporary shortage of material and labor) and also inflation of claims due to relaxed claims processing procedures after an event.

Pre-Event Insurance Contracts for Windstorms

While events today exhibit different forms of PLA compared to historical events, it is clear that PLA has potentially always been an issue after large events, so we need to continue studying this phenomenon, to understand possible future costs. For example, many companies now establish mitigating measures, such as pre-event contracts, guaranteeing services, should an event occur.

For 300 years we have observed common factors across windstorms in Europe and there are lessons to learn from each event. However, the key to being prepared in the future is to:

  • Monitor changing trends
  • Maintain an accurate and up-to-date representation of exposure at risk
  • Understand how losses behave when events occur
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January 15, 2015
Lessons Hidden In A Quiet Windstorm Season

Wind gusts in excess of 100mph hit remote parts of Scotland earlier this month as a strong jet stream brought windstorms Elon and Felix to Europe. The storms are some of the strongest so far this winter; however, widespread severe damage is not expected because the winds struck mainly remote areas. These storms are characteristic of what has largely been an unspectacular 2014/15 Europe windstorm season. In fact the most chaotic thing to cross the North Atlantic this winter and impact our shores has probably been the Black Friday sales. This absence of a significantly damaging windstorm in Europe follows on from what was an active winter in 2013/14, but which contained no individual standout events. More detail of the characteristics of that season are outlined in RMS’ 2013-2014 Winter Storms in Europe report. There’s a temptation to say there is nothing to learn from this year’s winter storm season. Look closer, however, and there are lessons that can help the industry prepare for more extreme seasons. What have we learnt? This season was unusual in that a series of wind, flood, and surge events accumulated to drive losses. This contrasts to previous seasons when losses have generally been dominated by a single peril—either a knockout windstorm or inland flood. This combination of loss drivers poses a challenge for the (re)insurance industry, as it can be difficult to break out the source of claims and distinguish wind from flood losses, which can complicate claim payments, particularly if flood is excluded or sub-limited. The clustering of heavy rainfall that led to persistent flooding put a focus on the terms and conditions of reinsurance contracts, in particular the hours clause: the time period over which losses can be counted as a single event. The season also brought home the challenges of understanding loss correlation across perils, as well as the need to have high-resolution inland flood modeling tools. (Re)insurers need to understand flood risk consistently at a high resolution across Europe, while understanding loss correlation across river basins and the impact of flood specific financial terms, such as the hours clause. Unremarkable as it was, the season has highlighted many challenges that the industry needs to be able to evaluate before the next “extreme” season comes our way.…

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November 04, 2014
What to expect this 2014-2015 Europe Winter Windstorm Season
Adrian Mark
Adrian Mark
Senior Manager, Model Product Strategy, RMS

As a member of RMS' model solutions team, Adrian works to guide more informed usage of catastrophe models and enhance understanding of model uncertainty. This requires interaction with the market, as well as other important stakeholders such as regulators and rating agencies, to help RMS develop tools that capture the evolving needs of the risk management industry. Based in London, his primary focus is on supporting the RMS European modeling suite and in facilitating client understanding around the open modeling capabilities of RMS(one). Adrian holds a BS in meteorology and oceanography from the University of East Anglia and an MS in engineering in the coastal environment from the University of Southampton.

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