Boston-based catastrophe risk modeling firm AIR Worldwide (AIR) estimates that insurable losses (losses from properties that are eligible for insurance, whether or not they are actually insured) from Hurricane Alex are not expected to exceed $200 million USD. Since insurance penetration in Mexico is relatively low, insured losses are not expected to be significant. AIR’s loss estimate covers possible wind and flood damage to onshore properties in Mexico and is based on the available meteorological parameters and the forecast track for Hurricane Alex since it made landfall in northeast Mexico Wednesday night.
“Hurricane Dolly in 2008, which also reached Category 2 intensity, was the most recent hurricane to make landfall close to Hurricane Alex’s path,” said Dr. Tim Doggett, principal scientist at AIR Worldwide. “The last hurricane to form in the Atlantic basin in the month of June was Hurricane Allison, 15 years ago, in 1995. That year saw 19 named storms, 11 hurricanes, and five major hurricanes—a season very similar to that predicted for 2010. Alex also has been the strongest hurricane to form in the Atlantic basin in June since 1966.”
Hurricane Alex rapidly increased its strength as it approached land and crashed into northeastern Mexico Wednesday night as a strong Category 2 hurricane on the Saffir-Simpson Hurricane Wind Scale. The storm brought high winds of nearly 105 miles per hour and a storm tide of four to six feet above ground level (1.2 to 1.8 meters), and heavy rains to the area.
Once Alex began moving inland across northern Mexico it began to weaken. By the time of the National Hurricane Center issued its Thursday Advisory, Alex’s maximum sustained winds had already decreased to near 50 mph, placing Alex into the tropical storm category again.
Dr. Doggett commented, “While Alex made landfall as a more intense storm than was expected, because of the relatively low population in the area and the small size of Alex’s radius of maximum winds, Alex’s overall impact in terms of wind damage will be less than anticipated.”
“Insured residential properties in Mexico overwhelmingly are of confined masonry construction, while insured commercial properties are dominated by confined masonry and reinforced masonry construction,” said Dr. Doggett. “Both construction types should fare well against Alex’s wind speeds. Additionally, the area of Alex’s landfall and inland track is sparsely populated. Structural damage, therefore, is expected to be minimal. In total, given that insurance penetration in Mexico is relatively low, the resulting insured losses are not expected to be significant. The full extent and possible effects of expected flooding, however, remain uncertain.”
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