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BMS Tropical Update August 31st 9 am CDT

As expected, Dorian is currently a healthy Category 4 hurricane about 445 miles east of West Palm Beach, Florida.  I would expect Dorain to track toward the northern Bahamas today and it would not surprise me if for a brief period it reaches the status of a Category 5 hurricane.  However, starting tonight, Dorian should start to slow its forward motion which is currently at 12 mph.  There is high confidence that Dorian should be near the northern parts of Abaco Island in the Bahamas by Sunday afternoon.  This, however, is where the forecast uncertainty starts to build.  Because we don’t know how much Dorian will slow down, we don’t know exactly where it will be on Monday.  This is critical because on Monday night, the subtropical ridge that has been steering the storm westward is forecasted to weaken due to the arrival of some upper-level energy from the polar jet stream in the mid-latitudes which might allow Dorian to begin a northward turn into that gap of the upper-level ridge that has been keeping Dorian from moving northward. 

The ECMWF 500 millibars pressure chart. Orange areas are areas of higher-than-normal pressure. Blue areas are lower-than-normal pressure. As shown, a gap opens in the subtropical ridge allowing Dorian to get pulled northward.

Since last Wednesday, I have been talking about the overall forecast uncertainty with Dorian and early on mentioned the angle at which Dorian impacts the Florida coastline will make a large difference in how it affects the state, including the effects of storm surge and coastline winds.  The angle of high winds can create different outcomes, which is why the angle of impact is important.  In the last few track forecasts, the impacts of some of the tracks are less perpendicular to the coastline as the storm is expected to turn northward before a potential landfall which is quite different than the forecast just 36 hours ago.

Since Wednesday, I also highlighted many things that can help the insurance industry limit the effects from the uncertainty in the forecast.  One of the things I failed to mention was in Meteorology forecasting classes one of the lessons they teach is, “the trend is your friend.”  Over the last 36 hours or so the long range forecast guidance has been trending to a slower moving storm which is resulting in forecast guidance that Dorian might not make a Florida landfall and may actually turn to the north and track along the Florida coastline due to the weakness in the upper-level ridge as described above.  Yesterday I mentioned that the slow-movement of named storms often precedes erratic behavior or sharp turns, so what this trend suggests today is that Dorian may stay offshore, similar to Hurricane Matthew in 2016.  In this case, “the trend is your friend” as this overall scenario would drastically limit insured losses.  


There is no shortage of hurricanes that have bypassed Florida.  These types of bypassing storms have had varying impacts.  One might remember that Hurricane Floyd in 1999 caused substantial loss along the east coast of the U.S. and in today’s dollars resulted in close to $15–$20 billion in insured loss.  In contrast, Hurricane Matthew in 2016 was another very powerful category 3-4 hurricane as it tracked up the coastline but only caused about $1 billion in insured loss to Florida.  Both of these storms were clearly different with different impacts. Maybe the coastline has become more resilient since 1999 which might explain part of the loss difference between events. Both Floyd and Matthew were also impactful storms to Georgia, South Carolina and North Carolina, and this potential seems to be the overall risk focus for Dorian in the longer range as the models are locking onto different scenarios than a Florida landfall.  But the short term risk is not over for Florida as there is still a probability of coastal sections seeing hurricane-force winds.

Wind Impacts

BMS iVision allows clients to run risks to better understand various impacts from Dorian. This is the 3-sec wind speed gust in MPH from Verisk Weather Solutions. There will be some adjustment to this wind swath as the forecast evolves.

As discussed above, many forecast models have backed away from a Florida landfall.  This change is the current outlook that is forecasted by Verisk Weather Solutions, which shows minimal impacts to the Florida coastline.  Using BMS iVision users can also select historical storm tracks to understand expected loss.  Below I show the BMS iVision Verisk Weather Solutions verification for Hurricane Matthew in 2016 which may also represent an idea of what type of winds to expect along the coastline as another potential forecast scenario for Dorian.  It should be noted, however, that depending on the overall storm size, slight shifts in the forecasted track could result in a big difference in what types of wind speeds are experienced along the coastline of Florida which might be the difference in Dorian following Floyd in 1999 or Matthew in 2016.

BMS iVision allows clients to run risks to better understand various impacts from Dorian. This is the 3-sec wind speed gust in MPH from Verisk Weather Solutions. There will be some adjustment to this wind swath as the forecast evolves.

Flood Impacts

The good news is with Dorian shifting its forecasted track to the east of Florida the trend has moved the heaviest rain eastward as well.  This means that freshwater flooding may not be as bad, but the coastal section could still see rain and the compounding impacts of storm surge with waves and coastal erosion. The current forecast expects significant wave heights for the next several days with the storm producing intense swells in excess of 30 feet as it moves north and then northeast.  These waves will likely produce dangerous surf along ocean-facing beaches, beach erosion, and potential coastal flooding given the extremely high tides this weekend.

The rainfall forecast is highly dependent on the forecasted track of Dorian: Source: NOAA

Long Range Ideas Impacts for Dorian

Exactly how close the center of Dorian makes it to the Florida coast is still something we don’t know, and likely won’t until Monday.  By Wednesday, the storm is expected to still be offshore near Jacksonville, Florida.  The current expectation is that it will begin turning to the northeast in response to an approaching mid-latitude trough.  This will bring the storm either over, or very close to, Georgia, South Carolina and North Carolina.  Again, the exact track is still uncertain but the general idea is becoming much clearer.  On Thursday, the storm will probably be departing North Carolina and heading off to the northeast as it transitions into a powerful extratropical cyclone.  The storm may pass close enough to Cape Cod to bring rain and wind to parts of New England, but it’s far too early to tell what the extent of those impacts might be.

BMS Tropical Update August 30th – 9 am CDT

There has been no significant change since yesterday to the overall favorable environment for further intensification between now and Sunday. Moisture availability will steadily increase, shear will remain in the range that may help ventilate a hurricane, and ocean heat content is robust along the full track and highest in the Gulf Stream waters that Dorian will encounter just prior to expected landfall. However, if Dorian slows, this might create some upwelling and weaken the hurricane. This is still uncertain.

When I give talks about weather trends, I often lead with a slide that suggests our weather memories are very short. When I look at the forecast for Dorian, I see a bit of déjà vu in how similar this forecast is to the evolution that occurred with Hurricane Florence last year. Remember, initially, the forecast for Florence was for a more rapid track with major hurricane status at landfall. But, the forecast models later reflected Florence stalling along the Carolina coastline with a bit of a west-southwest component of motion. Not only did the track have a notable change, but this slowing also caused Florence to weaken just prior to landfall, likely due to upwelling of colder ocean water. Whether or not this could happen with Dorian is a big question. Right now the NHC is not forecasting a weakening at landfall, but until 24 hours before Florence made landfall there was no sign of weakening either. At this point, the insurance industry should prepare for Dorian to make landfall as a major hurricane, as this is what the best model guidance and forecasts are indicating at this time.

The Gulf Stream and ocean heat content off the Florida coast is impressive. Source

Similarly to Hurricane Florence last year, there is still a considerable amount of track uncertainty in both the direction and the forward speed of the storm which, again, could impact the intensity. Over the next few days, Dorian will continue to track northwest, but will begin to arc westward later today as it moves north of an upper-level low near Cuba and the Bermuda high strengthens and expands to Dorian’s north. Models are in agreement on the timing of the turn west or, depending on some models, even west-southwest. What happens later tomorrow is still uncertain as the models disagree on how far west Dorian will track and at what forward speed.

The ECMWF ensembles remains highly contentious in large part due to dramatic differences in Dorian’s forward motion across models and ensemble suites. For example, in just 48 hours, the spread across the last night’s run of the ECMWF is a whopping 300 miles! Source

If you have been watching the NHC forecast, which, as I pointed out yesterday, is one of the best to review, the track speed and timing of landfall has been slowing. Earlier in the week, landfall was expected to be Sunday – now it’s Monday night. Slow moving named storms often precede erratic behavior or sharp turns, so what this trend in the NHC track really means is increased forecast uncertainty. There is still a chance that Dorian may stay offshore, similar to Hurricane Matthew in 2016. I am a bit doubtful of this, however, given that climatology and weather models typically seem to forecast the western Atlantic high pressure as weaker than it really is. The majority of forecasts have Dorian making landfall as a Category 3 or 4 hurricane near Palm Beach, Martin or Saint Lucie counties. This would put Dorian in a similar landfall area to Hurricane Jeanne, which made landfall as a Category 3 hurricane in 2004 and, today, would cause about $8B in insurance loss.

All the impacts below are all dependent on the track and intensity.

Wind Impacts
When analyzing wind impact, it is important to understand the design of typical structures across Florida to withstand high wind speeds. The following is a great online interactive map. It should be noted that older structures would have slightly different wind speed thresholds depending on the era, but generally, the trend would be similar to what is shown below.

Design wind speeds in the Keys (Monroe County) are also 180 mph vs 130-170 mph along the east coast of FL. Source:
BMS iVision allows clients to run risks to better understand various impacts from Dorian. This is the newest 3-sec wind speed gust in MPH from Verisk Weather Solutions. There will be some adjustment to this wind swath as the forecast evolves.

Flood Impacts
The trend towards slower motion near or over Florida compounds flooding potential for the state. Dorian’s forecasted landfall intensity is capable of producing structural wind damage and life-threatening coastal surge, but the rising possibility of the hurricane traveling along or up the peninsula at 5-10 mph means widespread rainfall totals of 10 inches or more, especially north and east of the center track. This may be a major issue for the insurance industry.

This is the rainfall forecast which is highly dependent on the forecasted track of Dorian. Source:

The American Community Survey (2011-2015), estimates that 26% of Florida residents live in the combined 100-year and 500-year flood plains, as indicated by NFIP. The risk of damage from floodwater is real and growing in a large percentage of the U.S. and even more so in Florida.

The private residential market has grown quite rapidly in Florida, too. There are more private flood carriers active in Florida than in any other state. As of July 2018, there were 29 admitted insurers offering primary residential flood insurance in the state, up from 20 in December 2017, and 16 in December 2016. There are also many managing general agencies (MGAs) in Florida that offer flood coverage.

In fact, according to a recent Wharton Risk Management flood market study, there are more than 58,000 private primary residential flood policies across Florida. With that total, there are more private residential flood policies in Florida than there are NFIP policies in 35 different states, including Alabama, Pennsylvania, Illinois, and Washington.

The image above shows the number of private policies by county in Florida.

Given the current forecast of Dorian, this could be the first real test of the residential flood insurance market.

The forecast is suggesting increased confidence that a Florida landfall will be perpendicular to the coastline. This aspect will be important in relation to the storm surge and may result in higher wind impact inland. However, the overall track will determine the wind.

There is a high likelihood that the impact of Dorian will be felt along the entire East Coast, but will be drawn out over the next week as Dorian slowly gets pulled away from Florida into the mid-latitudes. This will increase the insured loss chances of states outside of Florida. A few additional things to consider as Dorian approaches the Florida Coastline:

  1. Soil moisture is already high across much of the state, which could increase tree fall and power outages.
  2. With a new Super Moon occurring today, current tides will be running higher than normal, which could increase coastal flooding and any intensify aspects of storm surge that might occur.
  3. With Dorian potentially making landfall over a holiday weekend, the amount of lost revenue from hotel and restaurants has the potential to be higher, which could increase business interruption in some cases.

BMS Tropical Update 8/29/2019 – 9 AM CDT

Forecast Uncertainty and Verification

Let’s for a minute take a step back and think about when Dorian first became a tropical storm 725 miles southeast of Barbados.  At that time the long-range five-day forecast from the National Hurricane Center (NHC) suggested Dorian would track over the Dominican Republic.  As the NHC forecast advisories were issued, the forecast kept shifting north and east.  As we know now, not only did Dorian miss the island of Hispaniola, but it missed Puerto Rico to the east and will now completely miss the southern Bahamas as well.  When retrospectively looking back from when Dorian first became a tropical storm, its final track position was still within the far upper right part of the cone of uncertainty.

Shown above is the NHC forecast from forecast advisory number two. A red dot has been placed on the map illustrating the verified forecast position which was in error of 109 miles northeast of the forecasted location on the 96 hours forecast.

Over the last several days, the intensity forecasts issued by the NHC have been constantly revised upward and are only now starting to level off in intensity as a category 3 hurricane as Dorian approaches the Florida East Coast.

Tools To Help With Forecast Uncertainty

Because there seems to be a wealth of information flowing around Dorian, I want to share some publicly available tools to help determine what may be the best forecast models to help the insurance industry best narrow down the potential impacts from Dorian.

First, the NHC is historically one of the hardest forecast beat in both forecast track and intensity.  The average track error from past storms makes up the cone of uncertainty they provide.

Second, with so many weather models in existence, it can become quite difficult to select which one to use. It seems each large government has its own forecasting model. There are also universities that run their own models and in some cases private companies run their own models as well (the latter is what Verisk Weather Solutions does, and what is used in our BMS iVision product which offers clients another view they might not be able to obtain from public sources).  Even some reinsurance companies have at times run their own weather models, so there is no shortage of named storm track and intensity guidance. 

BMS iVision allows clients to run risks to better understand various impacts from Dorian. This is the newest 3 sec wind speed gust in MPH from Verisk Weather Solutions. There will be some adjustment to this wind swath as the forecast evolves.

All of these models offer up different paths and intensity forecasts which really adds to the overall uncertainty in an overall named storm forecast.   Historically the European Center for Medium-Range Weather Forecast (ECMWF) has been one of the better long-range forecast models in terms of accuracy.

Third, some of these models actually run ensembles which are formed by taking slightly different initial conditions and/or model physics and integrating each of these ensemble members to generate a spread of possible outcomes.  Since the atmosphere is a chaotic system, small initial differences can have profound impacts on the tracks and intensities of tropical cyclones at a future time.  These differences will result in different model results. The ECMWF runs an ensemble that has 51 different members.  That is a lot of different forecasts from just one model; therefore when using an ensemble it is best to pick the model consensus.  

Fourth, Brian Tang, an associate professor of atmospheric science at the University at Albany, has developed some tools to help limit the uncertainty in named storm forecast by looking at model forecast skill in real-time.   Professor Tang looks at various forecast lead times for forecast intensity and tracks.  The tools may be found here.

Currently, forecast intensity bias over all forecast time periods is suggesting the OFCL (the NHC official forecast) has the least amount of error, and for the 96 hour forecast period the LGEM model (the SHIPS Logistic Growth Equation [LGE] forecast model) shows the lowest intensity error. The number above each column is the number of forecasts used in the calculation. Use this graph to track which model might be preforming the best for forecasted intensity. For a key as to the acronym of each of the models shown use the following source.
Similar to the intensity bias, the track error may also be calculated. Currently, the forecast track error over all forecast times is suggesting the COTC model (the Naval Research Laboratory COMPS-TC model) has the best track skill. The UKX (the UK Meteorology Office model) is also doing well but does not have as many validated forecasts as indicated by the number above each bar. Again, the OFCL NHC forecast is also one of the better-performing forecasts at 96 hours.

Dorian Impacts

It is still too early to determine all of the impacts of Dorian.  As highlighted yesterday, there are some things to think about that are already known factors: 

  1. The forecast is suggesting an increased confidence that a Florida landfall will be perpendicular to the coastline.  This notion will be important in relation to the storm surge impacts and may result in higher inland wind impacts; however, it could perhaps result in an overall narrower area of impact to the insurance industry if the storm crosses the Florida peninsula.
  2. There is a chance the storm stalls over Florida, or moves much slower, which could enhance the wind and flooding aspects of Dorian.
  3. Soil moisture is already high across much of the state which could increase tree fall and power outages.
  4. With a new Super Moon occurring on August 30th, current tides will be running higher than normal which could increase coastal flooding and increase aspects of any storm surge that might occur.
  5. With Dorian potentially making landfall over a holiday weekend, the amount of lost revenue from hotel and restaurants has the potential to be higher, which could increase business interruption in some cases.

All Eyes On Dorian As The Holiday Weekend Approaches

With the peak of hurricane season just 12 days away, the tropical Atlantic is awakening right on cue. As we received the final advisory on Tropical Storm Chantal in the North Atlantic a few days ago, Tropical Storm Dorian was taking shape roughly 1,500 miles to the south in the deep tropics. Dorian is currently the only tropical system that should be of concern to the North American insurance industry, as recently named Tropical Storm Erin will be short-lived off the eastern coast of the U.S. and have minimal impact on the Canadian Maritimes.

The Bottom Line
The forecast models for Dorian are now showing Dorian will intensify as it travels east of the Bahamas. This is due to a much better environment which contains less dry air, lower wind shear, and warmer sea surface temperatures. The insurance industry should anticipate a stronger storm east of the Bahamas, as well as the possibility of Dorian making a Florida landfall as a major hurricane. However, it should be noted that the uncertainty in the forecast at this time is high with a mixed bag of possible outcomes, ranging from a weaker category 1 east of Bahamas to a major hurricane. While uncertainty is high, wind and rain impacts are possible in Florida later this weekend.

Dorian Forecast Details
In its long trek across the Atlantic, Dorian hasn’t been able to strengthen much because of dry air intrusion. Dorian has featured pulses of convection from time to time, but that convection hasn’t really been able to surround the center of the storm. Although Dorian will be passing over very warm water, the dry environment and a bit of wind shear could keep it in check over the next 48 hours.

There are several variables that will determine Dorian’s fate, but it seems that there are two critical periods. The first will be Wednesday night when Dorian will be in the vicinity of Puerto Rico. If Dorian passes over too much of Puerto Rico, it will interact with high mountains that could rip it apart. Restrengthening will take more time. However, if it just skims Puerto Rico, it has a better chance for survival downstream and will take less time to restrengthen.

The next critical period, sometime around Friday night, will be when Dorian moves into an environment which is more favorable for development as Dorian gets steered towards the east coast of Florida around an upper-level ridge. Some models indicate that there will be a broad upper-level trough to the west. Whether or not that hinders Dorian’s intensity with increased wind shear is a big source of uncertainty at this time and one of the only factors limiting the intensity forecast.

It’s really too early to be confident about a track forecast, so the current forecast by the National Hurricane Center is as good as any. That being said, the “cone of uncertainty” is over 400 miles wide at 120 hours, which is roughly the forecasted lead time for a potential Florida landfall. Also, the distance from Jacksonville to Miami is 347 miles, so a large section of the Florida coastline could potentially experience Dorian.

At this time it is not advised to focus on the NHC center track line. The cone is the track and the cone at this point is 400 miles wide. At this time it is too early to say where Dorain will make landfall, but Florida has the highest probability at this time.

Intensity forecasts are tricky, and it’s much too early to speculate. Dorian could be an anywhere from a weak category 1 hurricane, with just heavy rain and minimal wind threat, up to a major hurricane. However, with the warm sea surface temperatures over the Bahamas and lower wind shear, a stronger storm should be expected and the trend in intensity forecasts over the last 12 hours suggests this.

Yesterday much of the insurance industry was thinking a tropical storm as Dorian tracked into the Bahamas. In the last 12 hours, the trend is for a much stronger storm. No reasons why a major hurricane couldn’t also be in the future forecasts, a weaker storm is unlikely as Dorain tracks into the eastern Bahamas over the next 48 hours.

Things To Consider At This Time
Although a Florida landfall has the highest probability (65%), the angle of landfall can make a big difference in impact. The angle will impact everything from storm surge to the wind along the coastline. Although much of Florida recently saw some sort of impact from Hurricanes Michael and Irma, not all areas experienced high winds. The angle of these high winds can create different outcomes, which is why the angle of impact is important. Of course, this will all depend on the strength of Dorian at landfall, which is unknown at this time.

Soil moisture could also be a factor. Coastal locations south of Cape Canaveral have been fairly wet, while points to the north have been dry over the last 30 days. We could see increased treefall if the higher winds occur where the soil is saturated, but the rainfall could actually be welcome news for points to the north.

With a new Super Moon occurring on August 30th, current tides will be running higher than normal which could increase coastal flooding and increase aspects of any storm surge that might occur.

With Dorian potentially making landfall over a holiday weekend, the amount of lost revenue from hotel and restaurants has the potential to be higher, which could increase business interruption in some cases.

Wildfire Outlook and Future Problem Areas – August, 2019

While the global insurance industry seems to be eyeing every cloud mass in the Atlantic Ocean for the development of the next possible named storm and what might unfold in terms of overall activity and landfalls, the industry should also pay attention to a different type of weather forecast. Some similarities can be drawn between the lower 48-state fire season and the Atlantic hurricane season in that they are both off to fairly quiet starts. There is curiosity within the industry as to whether the back half of both of these seasons will be hyperactive.

With a total of over $33B of North American wildfire insured loss since 2016, it’s clear that wildfire has taken on new importance in the insurance industry. The good news is that much of North America is exiting the core of the fire season and, so far this summer, there has been a welcome wildfire reprieve. In California, only 24,579 acres have burned this year as opposed to 621,784 acres last year (CAL FIRE Only stats to Aug 22). The other bit of good news is that California has only about 6.73% of the state under abnormally dry conditions, with no drought conditions being reported. This is a vast improvement from one year ago when 47.19% of the state was reporting drought conditions.

California Department of Forestry and Fire Protection (CAL FIRE) combined Statistics including the U.S. Forest Service for the state of California.

There is still much of the fire season remaining, including the most dangerous time of year when strong, dry offshore winds peak during the months of September, October and November and have, historically, been associated with the majority of California’s worst fires. The Santa Ana and Diablo winds which, when combined with abundant fine fuels, can lead to elevated fire activity, even if the current fire risk is low. In fact, after a fairly wet winter, the abundance of fine fuels, such as annual grasses, has increased, which adds to the fuel load across the region. As these fuels dry out, there is significant risk if a fire starts and high winds are present.

The National Interagency Fire Center is one of the official sources for wildfire assessments and outlooks. According to its forecast, the areas of greatest concern continue to be the lower and middle elevations across California, the northern and western Great Basin, and portions of the Pacific Northwest where the robust grass crop has cured and can become an easy source of fire.

Since the halfway point of the western wildfire season has passed, there are some signals that point towards an active, compressed, season across the west as the southwestern monsoon becomes more active. While this will effectively end the fire season across the southwest, lightning-induced fire activity is expected to increase elsewhere. And, since humans cause the majority of wildfires, risk is always present. When accidentally or intentionally set fires are combined with wind events, which have been largely absent thus far, but will intensify in frequency by mid to late month as dry frontal passages become more common, the risk of wildfire will also increase. Wind events and low humidity will contribute to a likely increase in fire occurrences into the start of November.

During the late fall or even early winter, when a high-pressure system forms over the deserts of the Great Basin, the high pressure circulates clockwise, pushing air westward toward the lower-pressure areas of the coast, where it drops from high elevation to sea level. This causes the air to become compressed and it heats up, and its relative humidity drops. As the air drops from high elevation to sea level it can be forced through passes and canyons. This can cause wind gusts of 40 to 60 mph or even stronger. Image Source: InsideClimateNews

Unlike a hurricane, which often provides the insurance industry with a few days’ notice to determine expected loss, devastating fires often occur at a moment’s notice. The best thing the insurance industry can do is practice good accumulation management now, acknowledging areas that could become the next Paradise, California. Recent work by Pamela Ren Larson and Dennis Wagner at concluded that there are as many as 526 locations with a higher wildfire potential than Paradise, CA. In the absence of a newer, sophisticated catastrophe model, the insurance industry can still use Larson and Wagner’s very thoughtful analysis to determine the overall risk to a portfolio via a simple risk score. Although their analysis looked at the hazard, it also tried to understand the overall human risk, which life and casualty lines should contemplate.

The insurance industry may also want to consider analyzing areas outside of the western U.S. that could become the next Gatlinburg, Tennessee. For example, the 1.1 million acres of Pine Barrens in New Jersey, which is mostly rural despite the proximity to the sprawling metropolitan cities of Philadelphia and New York City, could result in a major insurance industry loss. There are vulnerable locations along the wildland-urban interface where fires are common. At some point, the weather conditions will be right to create a worst-case scenario, which could impact towns like Tabernacle or Barnegat Township in New Jersey. Thankfully, the peak of the wildfire season in New Jersey is during the spring months.

General Wildfire Risk Hazard Across the State of New Jersey. Source: Rolling Stone Will-Americas worst Wildfire Disaster Happen In New Jersey

Another recent concern is the increased wildfire risk that has been created by Hurricane Michael across Georgia and the Florida Panhandle. According to the National Association of State Foresters, a total of 92 million tons of timber, or roughly 4 million truckloads of timber, were destroyed by Michael’s fierce winds. The volume of dead and downed fuels will likely contribute to an increase in the number, intensity, and duration of wildfires over the next three to ten years. According to the Association, there are typically 4.87 tons per acre of available fuel in Florida. Currently, the average is up to 58 tons per acre – a ten-fold increase. In a catastrophic area, there are over 100 tons per acre. In fact, analysis done by the Southern Wildfire Risk Assessment Portal puts 49 communities at risk in the catastrophic wildfire zone and 194 communities at risk in the severe wildfire zone. Again, much like New Jersey, the highest likelihood of wildfire across this region is in the spring.

While the wildfire season will likely end up being below normal in terms of acres burned for the western U.S., it only takes one fire under the right conditions to make a memorable season. Significant wildfires can occur even when fire conditions are not extreme. Therefore, it is beneficial to understand wildfire risk accumulation and determine what is a comfortable level of loss by simple aggregation analysis or using new sophisticated wildfire models. These models have suggested that recent wildfire seasons are on the order of a 30 to 60-year return period, so none of the recent U.S. wildfires are considered tail events. Instead, these events have low return periods of less than 100 years, which reflects increasing U.S. wildfire risk in large part due to development of the wildland-urban interface. Insurance companies should understand this risk due to the proliferation of wildfire-prone areas throughout the U.S.

BMS Tropical Update – August 13th

It’s been a while since the last BMS Tropical Update on July 11. That update focused on Tropical Storm Barry, which eventually made landfall along the central Louisiana coastline as a minimal Category 1 hurricane. Even though it was a disheveled mess of a storm, it still caused nearly $100 million of insurance industry loss in Louisiana and set an Arkansas state rainfall record of 14.58” near Murfreesboro, Arkansas. Luckily, this large amount of rain did not fall along the Mississippi River in southern Louisiana, which was at already historic high levels along many sections, including levy-protected New Orleans. With Barry’s landfall, it joined 12 other July hurricane landfalls in the Gulf of Mexico since 1900. However, as we look forward to the remaining months of the hurricane season, it’s worth noting that there is no correlation between hurricane activity occurring before August and how much activity will be seen during the remainder of the season.

By now you may have seen the various updated Atlantic hurricane season forecasts, which, for the most part, continue to call for above-normal activity. As I have stated several times, the overall number is not what is important, but, rather, the steering currents that influence the track(s). Contrary to popular belief, however, most named storms have fairly regular and well-defined tracks because of the location and orientation of the Bermuda Azores high pressure, which ultimately determines the tracks of most named storms. The difficulty in predicting a storm track occurs either when the typical climatological steering wind flow is replaced by a less common, large-scale flow or, even more importantly, when rapid changes occur in the strength and orientation of the steering current, such as a bypassing mid-latitude trough, which is really only well-forecasted 5 to 7 days in advance.

Above is the current steering flow across the Atlantic Ocean. Note the current weakness across the Bermuda Triangle. Absent any mid-latitude system, this would likely be the path for named storms out of the deep tropics.

The average date for the formation of the season’s third named storm is August 13, and the average date for the second hurricane is August 28, so there is nothing unusual about having a calm spell this time of year like we’ve seen recently. There have been several tropical waves that have propagated from the African coastline, and a few of these have been watched by the National Hurricane Center. Tropical Depression Three, which formed for less than 24 hours off of the eastern coast of Florida, provided a glimpse of where named storms could track this season if the current North American and Atlantic pressure patterns hold into the peak of the hurricane season. However, first let’s determine the factors to consider for the remainder of the hurricane season and then worry about the steering current once the storms begin to form. In the beginning of the season, it was suggested that named storms would form closer to the U.S. coastline rather than in the Main Development Region, and track closer to the eastern coast of the U.S. with the overall season seeing more back half activity.

Although many of the headlines suggest that an above-normal season is yet to come, these headlines should probably be taken with a grain of salt. Take the NOAA forecast, for example. There is a 45% probability of an above-normal season, which obviously means there is a greater chance of a normal to below-normal season at 55%. In fact, I don’t think there is much confidence in the August activity forecasts, even though they are usually the most accurate when it comes to the overall Atlantic Basin activity.

There are a number of reasons why there is a lack of confidence in the forecast:

Unfortunately, even with the more reliable August forecast, there are still a lot of variables for the remainder of the season. Perhaps the best guidance would be to view the analog years, which serve as a guide for potential activity and possible tracks for the remainder of the season.

Above are the various analog years (1991, 2012, 2014, 2015) which may best indicate the current conditions and possible track of storms this season. Depending on the overall timing of development, analyzing these years may provide a guide as to the general track storm could take this season, but the timing of mid-latitude weather systems will determine the steering level winds if they reach the U.S. coastline. Example: Isaac or Sandy 2012 (Remember Sandy could have also turned out to sea)

This week we may see the remnants of an old stalled front off of the eastern coast of the U.S., providing a chance at tropical cyclogenesis closer to home. Hopefully, there won’t be a need for too many BMS Tropical Updates over the next 30 days, will be keeping an eye on how any potential events could impact the insurance industry.