PERILS has disclosed its initial industry loss estimate for the Australia Christmas Storms which affected the states of Victoria, New South Wales, and Queensland during the period of 23 to 29 December 2023.
PERILS’ initial estimate of the insured market loss, based on loss data collected from the majority of the Australian insurance market, is AUD 1,395 mn.
In line with the PERILS coverage definition for Australia, this loss number covers the property and motor hull lines of business.
An updated estimate of the market loss from the Australia Christmas Storms will be made available on 29 March 2024, three months after the event end date.
From 23 to 29 December 2023, the states of Victoria, New South Wales, and Queensland in Eastern Australia experienced a prolonged period of severe convective storm activity with large hail, intense winds, flash floods, and tornadoes.
The extreme weather was driven by a low-pressure system over southeastern Australia which was blocked by a high-pressure system over the northern Tasman Sea.
As the low intensified, its cold front pushed into warm and humid air masses over the East Coast of Australia, leading to the formation of numerous convective storm cells and intense thunderstorms.
A combination of large hail, ferocious winds, tree fall and flying debris as well as flash floods was the main driver of the ensuing damage.
There were 10 fatalities, most as a result of drowning or tree fall accidents.
In Australia, storm event definition clauses for reinsurance purposes vary and can include meteorological conditions and/or loss aggregation periods with the majority being 168 hours.
PERILS generally follows the predominant clause and as a consequence the losses from the Christmas Storms are aggregated into one single insurance event for the period of 23 to 29 December 2023.
Australia xperienced a relatively benign 2023 compared to more recent years from a natural catastrophe perspective.
The 2023 Christmas Storms were the largest Cat loss for the Australian insurance industry for the calendar year. They concluded a record year of severe convective storm losses for the global insurance industry.
by Yana Keller
