Posted on 13 Nov 2012 by Neilson
Storm surge from Hurricane Sandy caused the bulk of damage to coastal areas in New Jersey and New York, while damage from direct wind appeared to have caused localized and spotty damage to mostly older buildings, according to a report from Willis Re.
The report is a result of a four-day tour members of the Willis Re catastrophe management services team made of several areas of New Jersey, including Ocean City and Atlantic City, and Staten Island, Coney Island and Rockaway Beach in New York. The team said in its report that storm surge damage to buildings ranged from moderate to complete collapse. The surge also brought with it massive amounts of sand that in some places within 0.25 miles from the coast was 2 feet deep, the report said.
Damages in the areas toured by Willis Re overwhelmingly was attributed to storm surge and almost none to direct wind, which seemed to confound the catastrophe team, which recommends "further study ... to help determine the reasons for the spotty wind damage patterns." In the localized areas that were damaged by wind, the team noted that damaged buildings were mostly older construction, with newer faring much better. Damage to newer construction was likely attributable to shoddy workmanship, the report said.
Sandy made landfall on the evening of Oct. 29 just southwest of Atlantic City, N.J., as a post-tropical cyclone and is expected to bring losses up to $15 billion, according to catastrophe modeling firm AIR Worldwide (Best's News Service, Oct. 31, 2012). Sandy is only the fifth hurricane to make landfall in the United States during the fourth quarter in the past 20 years.
The insurance industry had significant exposure to the storm. The top 25 writers of commercial automobile, commercial multiple peril, homeowners and private passenger auto insurance in 2011 in the Mid-Atlantic region wrote a combined $42.3 billion worth of direct premiums, according to BestLink, A.M. Best Co.'s online financial system.
The top five writers in the Mid-Atlantic region of the four lines combined in 2011 were State Farm, with direct premiums written of $6.22 billion; Allstate, with $6.04 billion; Berkshire Hathaway Insurance Group, with $5.07 billion; Liberty Mutual Insurance Cos., with $3.05 billion; and Travelers Group, with $2.95 billion, according to BestLink.