The risk of tropical cyclones in Brazil

Ten years after the first tropical cyclone ever recorded in the South Atlantic, a new Swiss Re study investigates the possibility and potential impact of another event like it.

Floods, drought and landslides are widely known to be recurring natural hazards across Brazil. But until recently, only few people would have imagined a tropical cyclone developing off the Brazilian coast, since the South Atlantic was widely assumed to be an ocean basin in which such events could not occur.

This view changed fundamentally when tropical cyclone Catarina struck Brazil in March 2004. In addition to lives lost in the southern states of Santa Catarina and Rio Grande do Sul, communities in these areas suffered considerable damage to property, land and infrastructure. In total, Catarina caused close to USD 500 million in economic losses.

What if?

The risk of tropical cyclones in Brazil (PDF, 529 KB), a new study by Swiss Re and the Swiss Federal Institute of Technology (ETH) explores the main atmospheric conditions that lead to the development of tropical cyclones in the South Atlantic. It asks: what would happen if a storm like Catarina hit Brazil today, after a decade of rapid economic growth which would most certainly put more people and property in harm's way?

According to the report's findings, the financial impact of a tropical cyclone striking the southern parts of Brazil, including the metropolitan area of Sao Paulo, could lead to economic losses of up to USD 20 billion. Although rapid economic growth has led to an increase in commercial and industrial insurance coverage, a large part of the damage would be uninsured. Insurance claims could nevertheless reach around USD 1 billion, an unprecedented amount for natural catastrophes in Brazil.

The adaptation equation

As Brazil continues its rapid development path and more people and assets concentrate along its coast, the question of how to manage natural disaster risk will gain even more importance. Building codes, sea defences, and emergency planning, as well risk transfer and insurance, are just some of the adaptation measures communities can take to prepare for future natural disasters. Since Catarina made landfall in 2004, we know the next big event could be a tropical cyclone.

Published 12 June 2014

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