A Relatively Disaster-Free Year, 2013 May Be the Calm Before the Storm

By Richard A. McGrath, CIC, LIA

One thing to be thankful for in 2013 was that the number of major natural disasters was relatively low.

The bad news is that 2013 may have literally been the calm before the storm. According to the 2013 CoreLogic® Natural Hazard Risk Summary and Analysis, “with the cyclical nature of some of these events, 2013 should be considered fair warning that 2014 will likely see a return to the higher average numbers of damaging natural disasters.”

Putting 2013 statistics aside, natural disasters in the United States have been becoming more common and more costly. The two years preceding 2013 were among the nastiest ever. While damages exceeded $1 billion in only two natural disasters in 2013, there were 14 natural disasters in 2011 and 11 in 2012 in which damages exceeded $1 billion.

Property damages from natural disasters totaled more than $110 billion in 2012, including $60 billion from Hurricane Sandy.

During the 32-year period from 1980 to 2012, damages exceeded $1 billion when adjusted to the 2013 consumer price index in each of 144 weather-related disasters in the U.S. That comes to an average of 4.5 major natural disasters per year. The total cost of the 144 natural disasters exceeds $1 trillion, according to the National Oceanic and Atmospheric Administration (NOAA).

Natural Disasters Are Cyclical

Natural disasters tend to be cyclical, so it’s not unusual for a disaster-filled year to be followed by a nearly disaster-free year – and for a year with few natural disasters to be followed by a year that’s full of them.

The CoreLogic report found that 2013 had a below-average number of tornadoes, hurricanes, floods and wildfires. We will soon find out whether 2014 is one of those years in which a year with a low number of natural disasters is followed by a year that’s full of them.

In the meantime, let’s consider CoreLogic’s findings for each of the categories its report covers.

Tornadoes. As of late October, there were 710 tornadoes in the U.S. during 2013. That may sound like a lot, but it’s 229 fewer than in any year during the previous decade.

Sturbridge residents can still see the destructive forces of the tornadoes that ripped through our town in 2011, but we can be grateful that we don’t live in Oklahoma. The most severe tornado ever recorded, measuring up to 2.6 miles wide, hit rural El Reno, Okla., in 2013, killing 13 people, while a second tornado sliced a 17-mile path through Moore, Okla., killing 23 people, injuring 337 and causing an estimated $2 billion to $3.5 billion in damages.

CoreLogic says future risk is “tied not only to the frequency of storms, but also to the possibility of individual storms to increase in size, speed, and severity.”

Hurricanes. While 2012 brought Hurricane Sandy, hurricanes were a non-event in 2013.

Experts predicted that 2013 would bring 18 named storms and nine hurricanes, including four major hurricanes. Instead, only 13 storms were of a large enough magnitude to be named and only two were classified as hurricanes.

None of the named storms had a direct impact on the United States. The first official hurricane of the year, Hurricane Humberto, was just three hours shy of setting the record for the latest date at which the first hurricane of the year was recorded.

In contrast, there were 19 named storms in 2012, of which 10 were upgraded to hurricane, including two major storms.

Floods. Given the low number of named storms in the Atlantic, it’s not surprising that flooding was moderate in 2013.

Still, residents of Boulder, Colo., would not consider 2013 a moderate year for flooding, as more than 19,000 homes across 17 counties were damaged or destroyed. CoreLogic estimated that 2013 flood losses totaled $2 billion. In comparison, Hurricane Katrina caused $100 billion in damages in 2005 and Hurricane Sandy damages in 2012 totaled $60 billion.

Mid-Atlantic states reported 56 flooding events in 2013, which was up from 35 in 2012, but far below the 2011 total of 454.

Wildfires. Both the number of wildfires and the total acreage burned were below the 10-year average in 2013, CoreLogic found. The number of fires was at the lowest level in 10 years, with about 40,000 fires reported, which is well below the 10-year average of 63,000.

Still, wildfires reached average levels in California, Colorado, Washington and Idaho, and some of the fires that took place in 2013 caused widespread destruction.

California’s Rim Fire, the third largest in the state’s history, destroyed more than 257,000 acres, including much of the Stanislaus National Forest and parts of Yosemite National Park. Colorado’s Black Forest fire burned through 14,000 acres, damaging or destroying more than 500 homes while causing more than $300 million in losses, while Arizona’s Yarnell Hill fire burned through 8,400 acres and destroyed 129 homes, resulting in the death of 19 firefighters.

With drought conditions persisting in the west and an increase in fuel load in wildfire areas, experts say there is increased wildfire risk in 2014. Fuel load is a buildup of easily combustible debris, such as leaves and branches, on the forest floor.

CoreLogic identified 740,000 residences with a value exceeding $136 billion at high risk of wildfire damage.

Sinkholes. Sinkholes are drawing increasing attention after three significant sinkholes caused damage in 2013 in Seffner, Clermont and Dunedin, Fla., resulting in one death and the destruction of two houses and a tourist resort.

CoreLogic has identified 23,000 sinkholes in Florida, and believes they have the potential to cause damage in other parts of the country as well.

It’s difficult to predict tomorrow’s weather accurately, so no one knows for certain what 2014 will bring, but it’s best to be prepared for the worst. Talk to your independent insurance agent to make certain you have the coverage you need to protect your family and your home. You may not always seem to need the coverage, but what if you do and you don’t have it?

Richard A. McGrath, CIC, LIA is President and CEO of McGrath Insurance Group, Inc. of Sturbridge, Mass. He can be reached at rmcgrath@mcgrathinsurance.com.

This article is written for informational purposes only and should not be construed as providing legal advice.