Industry loss from October storms in Australia estimated over A$1bn

Industry loss from October storms in Australia estimated over A$1bn

The insurance coverage and reinsurance market loss from severe storms that struck southern Australia in late October 2021 is currently estimated to be over A$ 1 billion by data aggregator and reporting company PERILS.The severe and convective storms struck South Australia between October 28th and 30th 2021, as low pressure system moved in a south-easterly direction throughout southern Victoria and Tasmania.
The associated cold front of the low brought widespread destructive hail, wind, drain flood damage and serious thunderstorms which affected inhabited locations in the 3 states, consisting of the significant urban centres of Adelaide and Melbourne.
The Adelaide region of was the very first area to be struck by the storm system on 28th October, experiencing heavy hailstorms and strong winds in the city and surrounding locations. The storm front then took a trip towards Victoria throughout the night and into the early morning of 29th October, driving heavy rains, hail and strong wind gusts of approximately 146 km/h.
Tasmania was affected by the frontal low during the morning of 29th October with strong winds and torrential rain.
The storms drove extensive damage to homes and vehicles from hail, torrential rainfall and strong winds, while there was also comprehensive power disruption affecting as much as 526,000 houses and organizations in Victoria and 30,000 in South Australia.
Residential or commercial property damage from the storms is extensively covered by insurance coverage, with losses generally associating with residential or commercial property and motor hull industries, however also with contributions from crop insurance which Perils does not report in its data.
Insurer IAG said that storms at this time caused losses above its reinsurance retention, while Suncorp said the upper-end of its quote for these storms is at the point its primary catastrophe reinsurance program would kick-in.
Darryl Pidcock, Head of PERILS Asia-Pacific, commented, “The losses to the insurance coverage industry from the Southern Australia Severe Storms were common for this kind of spring storm in that they were created by a mix of surface area, hail and wind water flooding. For the state of South Australia alone, the storm will likely be one of the costliest natural disasters ever.”
Hazards loss quote for the period of storms cover both home and motor hull industries and the initial market loss is pegged at A$ 1.028 billion (approx. United States $740m), a figure that will be upgraded in 3 months time.

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