AIR Worldwide Estimates Industry Insured Losses in China from Typhoon Lekima Will Exceed CNY 6 Billion

BOSTON, August 14, 2019 – Catastrophe risk modeling firm AIR Worldwide estimates insured losses in China from Typhoon Lekima will exceed CNY 6 billion. Lekima made landfall in Taizhou, Zhejiang, China, at 2 a.m. on August 10 local time, with JMA-estimated 1-minute sustained wind speeds of 181 km/h (112 mph), the equivalent of a Category 3 hurricane on the Saffir-Simpson Scale. Lekima was the strongest storm to hit this region since Typhoon Chan-hom struck in July of 2015.

The ninth typhoon this year, Lekima briefly had a peak intensity of 920 mb, according to the Japan Meteorological Agency (JMA). After Lekima passed north of Taiwan, Lekima’s maximum 1-minute sustained winds weakened to 181 km/h with a central pressure of 950 mb as it struck China’s east coast about 200 miles south of Shanghai, bringing torrential rain.

Lekima’s path moved slowly north-northeast through Zhejiang Province, passing over the city of Shanghai and crossing Jiangsu Province at a fast forward speed exceeding 40 km/h. The storm made a second landfall on the coast of Qingdao in Shangdong Province at 8:50 p.m. Sunday, local time, at tropical storm strength, continuing north across the province to reach Bohai Bay on Monday, August 12.

Records were broken as a weather station in Shangdong measured 217.5 mm of rainfall between Saturday morning and Sunday afternoon—the highest since record-keeping for precipitation began in 1952. As of August 12th, 73 rivers reached or exceeded flood levels and regional authorities warned of more flooding due to continued heavy rainfall in the four northern provinces.

Gales and heavy downpours struck all along Zhejiang, Shandong, and neighboring provinces as Lekima moved north, triggering landslides and flooding roads, homes, businesses, and cropland. One landslide north of the city of Wenzhou blocked a river, causing a temporary earthen dam that later burst, deluging the village of Shanzao. Damaged roads and interruptions to power and telecommunications have been reported all along the storm’s path.

In Shangdong, operations at major oil refineries were closed down as of August 13 due to flood damage and lack of road access.

Travel, tourism, and shipping have been particularly affected by Lekima. Train, plane, and bus travel were suspended, and ships were recalled to port in advance. Two of Shanghai’s largest airports canceled most flights, with hundreds of cancellations reported at other airports across China, including in Beijing.

Major tourist destinations around the northeast were closed with the potential for further business interruption as recovery from the storm continues.

AIR’s modeled loss estimates include:
• Insured physical damage to onshore property (residential, industrial, commercial, and Construction All Risks/Erection All Risks), for both structures and their contents due to wind and/or precipitation-induced flooding in the following provinces in China: Anhui, Hebei, Jiangsu, Shandong, Shanghai, Tianjin, and Zhejiang

AIR’s modeled insured loss estimates do not include:
• Losses to uninsured properties
• Losses to infrastructure
• Losses from storm surge
• Losses resulting from landslides
• Losses to crops, livestock, and poultry
• Losses to auto
• Losses resulting from physical failure of flood defenses
• Losses from hazardous waste cleanup, vandalism, or civil commotion whether directly or indirectly caused by the event
• Demand surge
• Other non-modeled losses

About AIR Worldwide

AIR Worldwide (AIR) provides risk modeling solutions that make individuals, businesses, and society more resilient to extreme events. In 1987, AIR Worldwide founded the catastrophe modeling industry and today models the risk from natural catastrophes, terrorism, pandemics, casualty catastrophes, and cyber incidents. Insurance, reinsurance, financial, corporate, and government clients rely on AIR’s advanced science, software, and consulting services for catastrophe risk management, insurance-linked securities, longevity modeling, site-specific engineering analyses, and agricultural risk management. AIR Worldwide, a Verisk (Nasdaq:VRSK) business, is headquartered in Boston, with additional offices in North America, Europe, and Asia. For more information, please visit www.air-worldwide.com.