Gulf region flooding impact in the $100s of millions

This week’s torrential rain and flooding in Dubai and throughout southwest Asia will probably cause hundreds of millions of dollars in economic damage, but Insured losses will be notably lower due to relatively low insurance penetration, Aon said today. 

The insurance broker said in its weekly catastrophe report that the deluge of rain, in which Dubai experienced as much rainfall in two days that it usually records in 18 months, had completely flooded Dubai International Airport leading to all 1,200 flights being  cancelled. 

“Dozens of aircraft were submerged by floodwater with the potential to result in notable material losses,” Aon said. “Dubai transport services were severely impacted, dozens of cars, private houses, and malls were inundated within the city centre. 

“Many locations in the country experienced power outages and a lack of water supplies. Local authorities (NCEMA) reported at least 4 flood-related deaths with several people remaining missing.”

Aon said: “Given the ongoing damage assessment and the notable damage caused over a large area, it is still too early to determine the estimated economic impact across the affected region. 

“However, initial assessments from the area suggest a significant impact on property, infrastructure, and agriculture, that will likely run to at least hundreds of millions of US dollars.

“Insured losses will be notably lower due to relatively low insurance penetration.” 

Elsewhere in southwest Asia, at least 20 fatalities were reported in Oman along with severe weather-related losses and  major disruptions.

An additional 71 people were killed in Pakistan where a state of emergency was declared. At least 70 people were also killed in Afghanistan where more than 2,600 houses were destroyed ot suffered damage. 

Moody’s RMS also released a statement on the storm, saying the Gulf region is “an area that is typically underserved with solutions for managing flood risk. 

It said: “The flooding this week in the Persian Gulf is a stark reminder that flood risk is a truly global peril. 

“The amount of rainfall that has been recorded in this event has exceeded historic levels. However, the region is also no stranger to intense precipitation - it is the scarcity of these events that challenges awareness for the hazard and leads to a lack of planning and preparedness. The Gulf region is an area that is typically underserved with solutions for managing flood risk. 

“Moody's global flood hazard data can help to identify the level of risk that can be expected from such flood events and with that can support important risk mitigation action.”

Separately, economic damage from a week of severe weather and heavy rainfall in the north-central and northeast US is also expected to have caused hundreds of millions of dollars of economic and insured damage. 

“Persistent severe weather and heavy rainfall from three weather systems brought impacts primarily to the north-central and northeast United States on April 11-18,” Aon said. 

“Notable flooding was seen once again over the Ohio River Valley, including near Pittsburgh. 

“Continuous severe storms caused widespread property damage and power outages over an area stretching from Nebraska to Pennsylvania. Total economic and insured losses could reach into the hundreds of millions of US dollars.” 

In addition to record rainfall for April, the region also received 38 tornado reports, 24 of which were submitted on April 16 alone. The strongest twister seen was rated EF-2 with peak winds of 130 mph (209 kph).

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