Hail, tornadoes and flash floods

Thunderstorm losses are on the rise

Thunderstorms rarely occur in isolation. Hail, gale-force winds, tornadoes and heavy precipitation are common risks. Flash floods, landslides, hail damage and flooding can be the result. The losses can often run into the billions. For insurers, being aware of changed weather risks is extremely important: in industrialised countries, many thunderstorm-related losses, e.g. from hail damage, are covered by insurance.

US$ 32 bn

Thunderstorm-related losses in the USA alone in 2022

After hurricanes, thunderstorms are the most significant severe weather risk for the insurance sector in the USA. A tornado or violent hailstorm occurring in the centre of a major city can result in extremely high single losses. On average, total losses were recently well into the two-digit billion range per year. In 2022 alone, thunderstorms in the USA were responsible for US$ 32bn in losses, two-thirds of which were insured.

In the USA, geographic aspects are conducive to thunderstorms: east of the Rocky Mountains, there’s nothing to stop cold fronts from travelling south, since there are no mountain chains in the way. When these cold fronts collide with warm and moist air, it frequently produces severe outbreaks of thunderstorms, often accompanied by tornadoes and hail.

Thunderstorms and climate change

According to research, the USA will not see an increase in the overall number of days on which especially severe thunderstorms with hail and tornadoes are likely to occur. However, there is a trend towards an increase in tornado series with a large number of storms. The risk of losses is rising.

Climate-model-based studies have concluded that increased atmospheric moisture is the motor of this change. In turn, the moisture is due to higher ocean temperatures and increased evaporation – which point to the effects of climate change.

The intensity of thunderstorms in certain regions of Europe has also increased in recent years. For example, the summer of 2022 was characterised by extreme temperatures, interspersed with severe storms and hail. In France alone, severe hailstorms produced unusually high losses of nearly €7bn, more than three-fourths of which were insured.

Due to climate change, the trend toward more frequent severe hailstorms will continue. Even in a moderate climate scenario, the number of severe hailstorms will likely rise by 30 to 40% by the end of the century in nearly all parts of Europe. In northern Italy, the Balkans, and along the Mediterranean coasts of France and Spain, the increase could be even higher.

Flash floods, landslides and flooding — The perils of severe thunderstorms

Severe thunderstorms can occur virtually anywhere. And that is precisely why loss prevention is so challenging: it’s virtually impossible to predict exactly where a thunderstorm will form. However, it is possible to identify areas that have a particularly high probability of thunderstorms and, as a result, a high probability of loss. In these regions, the loss potential can often run into the billions.

More frequent severe thunderstorms will further worsen the loss potential, which is already increasing due to higher asset values and repair costs.

Buildings and infrastructure are particularly prone to losses as a result of severe hailstorms. Photovoltaic panels, building insulation and exterior window blinds are contributing to rising losses, which is why loss prevention measures are so crucial.

Heavy precipitation resulting from severe thunderstorms can also lead to substantial losses. How quickly, where, and on what scale heavy precipitation leads to flash floods and flooding depends on the respective catchment area. Factors like steep declines or low water storage capacities due to areas that are sealed or covered with buildings increase the risk of flash floods after heavy precipitation. In addition, when the soil is over-saturated following repeated downpours, landslides can occur on hillsides. When flotsam and jetsam clog up outlets like culverts, the water gathers before the obstacle – and when it breaks loose, the result can be a devastating flood wave.

Tornado outbreaks — Loss drivers in the United States

Tornadoes are the wind systems with the highest wind speeds, and leave paths of destruction in their wake. They occur in powerful storm cells. At their edges, tornadoes’ wind speeds can reach up to 500 km/h.

The average width of a tornado funnel is around 100 m and the average path is a few kilometres, although widths of more than 1000 m and paths of up to 300 km have also been observed. Globally speaking, these storms predominantly form in regions with temperate climates, like Central Europe and the USA.

The animation illustrates the flow processes in and around a tornado

Tornadoes are so dangerous because they can form in a matter of minutes and, owing to their highly localised extreme wind speeds, can be even more destructive than hurricanes. In the American Midwest, these storms frequently occur along the infamous Tornado Alley, which runs roughly parallel to the Rocky Mountains, from South Dakota and Iowa in the north to Texas in the south.

In recent years, more than 1000 tornadoes per year have been observed on average. In Europe, there are usually several hundred tornadoes per year.