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Insurers face multibillion-dollar bill from US wildfires in September – Aon

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Insurers face multibillion-dollar bill from US wildfires in September – Aon

The fires that burned across parts of the Western U.S. through September are expected to lead to billions of dollars of total direct economic costs and a multibillion-dollar payout for insurers, according to Aon PLC's latest Global Catastrophe Recap.

The U.S. has now reported a record 22 fires with at least 100,000 acres burned so far this 2020, Aon said in its report. At least 43 people died and thousands of homes and other structures have been destroyed by the fires, which were particularly impactful in California, Colorado, Oregon and Washington state.

"The third quarter is historically the costliest of the year given the peak of tropical cyclone season in the Atlantic and Pacific Ocean Basins," according to Steve Bowen, director and meteorologist on Aon's Impact Forecasting team. However, the reemergence of wildfire peril also made headlines and "ensured a record sixth consecutive multibillion-dollar payout year for global insurers," Bowen said.

Hurricanes, storms and above-average rainfall across the world also caused billions of dollars of economic and insured losses in September.

Hurricane Sally, which made landfall in Alabama on Sept. 16, resulted in at least eight reported fatalities and several injuries. Total economic losses from the hurricane were estimated to be more than $5 billion, with public and private insurance losses expected to be over $2.5 billion.

More than $100 million of total economic losses were expected from Tropical Storm Beta, which landed along the southern end of the Matagorda Peninsula near Port O'Connor in Texas on Sept. 21.

Additionally, total economic losses were estimated at $165 million from the severe storms that hit parts of Minnesota, Iowa, Wisconsin and Illinois, and at $375 million from the strong cold front that caused notable damage in Utah and Idaho.

In Europe, total economic and insured losses from Medicane Ianos were estimated to reach $100 million. Millions of euros of total economic and insured losses were also expected from subtropical Storm Alpha, which made landfall along the coast of Portugal, and the severe weather outbreak that affected Italy in September.

In Asia, China braced for $32 billion of total combined economic losses from the impact of the seasonal monsoon flooding in September. China's Ministry of Emergency Management said the flooding resulted in the death of 278 people and damaged or destroyed over 1.4 million homes.

Total combined losses were expected to exceed $6 billion from the rainfall that caused damage and casualties in India. At least 1,925 people died and approximately 260,000 homes were damaged or destroyed, according to the Indian Ministry of Home Affairs' Disaster Management Division.

Above-average rainfall in Nepal caused further flash floods and landslides, killing 120 people and damaging tens of thousands of houses. The combined economic toll was expected to exceed $100 million.

Seasonal monsoon flooding damaged or destroyed at least 310,000 houses and affected an extensive area of cropland in Pakistan. The total combined economic losses were projected to surpass $1.5 billion.

Typhoons Maysak and Haishen in South Korea, which damaged thousands of houses across the country, were expected to cause total economic combined losses of more than $200 million.