Insurance: Ready for the 2017 Hurricane Season

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June, Too Soon…

*Tom Larsen co-authored this blog.

You may be familiar with the old hurricane season mnemonic;

  • June – Too Soon (first month)
  • July – Standby (for any news of a storm)
  • August – You must (prepare in case a storm comes)
  • September – Remember (to standby)
  • October – It’s all over (last month)1

But for the insurance industry it’s not too soon to plan for the upcoming hurricane season.

The latest 2017 forecast for hurricanes originating in the Atlantic Ocean and the Gulf of Mexico (which are the hurricanes that most commonly hit the U.S.) by TSR for the 2017 Atlantic hurricane season call for an average season with a total of 14 tropical storms, six hurricanes and three major hurricanes.2    And while not all hurricanes make landfall, it is important to know that even a glancing strike such as hurricane Matthew (2016) produce billions in insured losses.3

To get a better understanding of exposure in anticipation of the 2017 hurricane season, CoreLogic applied our high resolution North Atlantic hurricane model to generate an analysis of wind only exposure along both the Gulf and Atlantic coasts.

In addition to coastal exposure, hurricane risk varies by latitude, water temperature and the effects of steering wind patterns. To get a true view of risk and cost, CoreLogic overlaid our probabilistic hurricane model on our parcel boundaries and reconstruction valuation data to provide a unique view of the risk of property losses in the US from hurricanes. The reconstruction values used in the table below are the most significant way to evaluate this loss because they are the truest view of the cost to reconstruct a property if it were completely destroyed.

Damage to individual properties is strongly related to the winds that the property experiences.   This can be seen in the aftermath of Hurricanes Andrew and Katrina (both category 5 storms on the Saffir-Simpson scale) where thousands of buildings in the areas of highest wind were completely devastated.  But the winds generated in a storm are not uniform – the winds in a hurricane are most severe close to the center of the storm and the high winds decay as the storm moves inland from the coast.  Even the most severe storms have large geographic areas impacted by modest level wind speeds. Based upon simulations of tens of thousands of likely hurricanes, the winds calculated in this table are the maximum foreseeable winds – the most extreme winds in the comprehensive CoreLogic model database for each location.

So what is it that is keeping insurance risk managers up at night during hurricane season?  We’ve done the 2017 numbers –

  • 15.7 million. The number of homes along the US Atlantic and Gulf coasts that can reasonably expect to see hurricane force winds upon their structure (an even larger number, 45.7 million homes, can expect to see tropical storm force winds or greater).
  • $9.7 Trillion dollars. The reconstruction value of the residential homes along the Atlantic and Gulf coasts that are at risk from hurricane damage.
  • 3 Major Hurricanes.   The TSR forecast for Intense hurricanes (Cat 3 – 5)
  • 6 Hurricanes.  The TSR forecast for hurricanes (Cat 1 – 5)
  • 5 months. The typical hurricane season

It’s not too late to prepare your home, business or your policyholders to mitigate losses this hurricane season.  Risk mitigation begins before the storm by preparing your surroundings, protecting openings, strengthening roofs, creating a family emergency plan and developing business continuity plans.  The Insurance Institute for Business & Home Safety (IBHS) provides excellent resources to help prepare and respond to hurricanes on their website for the public at and for insurance industry members at

Of course, significant flood damage also occurs in coastal regions due to storm surge as a result of hurricanes. For additional information from CoreLogic on hurricane related storm surge risk go to Storm Surge Report




4 In the table above, risk calculations included were performed at a zip code level across 21 states and aggregated. Homes were categorized at their highest risk level; if a home fell into multiple risk levels, e.g. Extreme and Very High, it was categorized for this analysis as Extreme and was not included in the count or reconstruction cost value for Very High.

© 2017 CoreLogic, Inc. All rights reserved.


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