Newark, Calif. - Increases to hurricane landfall frequencies in the U.S. hurricane model from Risk Management Solutions (RMS) will increase modeled annualized insurance losses by 40% on average across the Gulf Coast, Florida and the Southeast, according to RMS. And modeled annualized insurance losses in the Mid-Atlantic and Northeast coastal regions will increase by 25% to 30%, relative to those derived using long-term 1900-2005 historical average hurricane frequencies.This new view of risk is driven by an increase of more than 30% in the modeled frequency of major (Saffir-Simpson Category 3-5) hurricanes making landfall in the U.S. to account for current elevated levels of hurricane activity in the Atlantic basin, which are expected to persist for at least the next five years. When compared with a pre-2004 historical baseline, as has been previously employed for quantifying insurance risk, the increases in modeled annualized losses are closer to 50% in the Gulf, Florida, and the Southeast.

The increased frequency and intensity of hurricane activity in the Atlantic Ocean Basin, as observed since 1995, is driven by higher sea surface temperatures in the tropical North Atlantic and by associated changes in atmospheric circulation. These warmer temperatures are expected to translate into a continuation of high activity in the basin, leading to a greater potential for hurricanes to make landfall at higher intensities over the next five years.

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