Hurricane Arthur, the first tropical cyclone of the Atlantic Hurricane Season and the first hurricane to make U.S. landfall since Sandy in 2012, is not expected to produce losses exceeding $250 million from wind and coastal flooding, RMS says.
In a blog post Verisk's website, Ted Gregory, manager of Verisk's Property Claim Services, set the bar for losses even lower, saying the storm did not cause enough damage to be labeled a catastrophe.
“As of July 7, 2014, PCS has determined that the storm has not caused enough damage in the United States to warrant PCS catastrophe designation (PCS designates an event as a catastrophe when it reaches $25 million in claims and affects a significant number of policyholders and insurers),” Gregory writes.
RMS notes that on July 3, Arthur made landfall along Shackleford Banks, between Cape Lookout and Beaufort at the southern end of North Carolina's Outer Banks as a Category 2 hurricane. The hurricane weakened to a Category 1, tracked offshore from Massachusetts on July 4, then made a second landfall as a post-tropical storm in Nova Scotia, Canada.
In North Carolina, says RMS, most losses were from wind and coastal flooding. “The storm impacted mostly residential properties. Residential insurance policies typically provide cover for surge-driven flood losses,” RMS notes.
The firms says in Massachusetts and Nova Scotia, damage is mainly the result of localized inland flooding from the rainfall.
Brian Owens, senior director, business solutions at RMS, comments, “What is unusual about Arthur, particularly for this time of year, is that it rapidly deepened to become a Category 2 hurricane. It's also rare for hurricanes to form in early July, which climatologically is the quietest time of the hurricane season.”
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