2021 hurricane pre-season forecasts: another turbulent year
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Pre-season forecasts for the North Atlantic hurricane season predict above-average activity again in 2021. Disaster resilience will be key to minimise the potential impact.
The key takeaways from this edition of Economic Insights are:
- Predictions for the North Atlantic hurricane season are for an above average 2021, but short of 2020 observations.
- Long-term climate cycles such as the current positive Atlantic Multidecadal Oscillation phase imply a more active hurricane season: underwriting decisions should take this into account.
- It is too early to predict the level of insured losses, but higher activity increases the chance of a severe hit.
- With US inflation and construction prices having risen sharply, economic factors will adversely affect claims costs from any loss-making landfalls this season.
- As in all seasons, it only takes one hurricane landfall to make it an active season for coastal residents and disaster preparation is vital.