September 2nd, 2010

Update: Hurricane Earl

Posted at 9:37 AM ET

earl-thurs-smallEarl has re-intensified into a category four hurricane, with the center of the storm presently located around 410 miles (660 kilometers) south of Cape Hatteras in North Carolina and 870 miles (1,400 kilometers) south-southwest of Nantucket in Massachusetts, according to the National Hurricane Center (NHC). Earl is currently packing sustained winds of 145 mph (230 kmph) and is moving towards the north-northwest at around 18 mph (30 kmph). A turn to the north is expected later today and Earl is then expected to move towards the north-northeast. On this forecast track, the NHC says Earl will pass near the North Carolina Outer Bank tonight and approach southeastern New England on Friday (September 3)as it tracks parallel to the US east coast. At present, hurricane-force winds extend up to 90 miles (150 kilometers)from the center of the storm while tropical storm winds extend up to 230 miles (370 kilometers).

The NHC has issued a hurricane warning for the U.S. East Coast from Bogue Inlet, North Carolina, northeast to the North Carolina/Virginia border, including Pamlico and Albemarle Sounds. A hurricane watch is also in place for areas north of the North Carolina/Virginia border to Cape Henlopen in Delaware and from Westport to Plymouth in Massachusetts. The NHC added that a dangerous storm surge will raise water levels as much as 3 to 5 feet (0.9 to 1.5 meters) within the hurricane warning area. Forecasters also warn that up to 6 inches (150 millimeters) of rainfall is expected over parts of eastern North Carolina, including the Outer Banks.

earl-thurs-big

Hazard data illustrated in the CAT-i map was taken from i-aXs®, Guy Carpenter’s web-based risk management platform. i-aXs users can view impacted areas on any map as well as see how their portfolios were affected. Please contact your broker or Instrat® representative for assistance or go to www.i-axs.info for further information.

Earl has strengthened back into a category 4 hurricane over the last 12 hours, according to the NHC. However, unfavorable environmental conditions including dryer air and increased sheer from a trough of low pressure is expected to see the hurricane gradually weaken over the next 24 hours. Despite this, Earl is expected to remain a strong hurricane over the next few days and could pack winds of around 100 mph (160 kmph) as it passes Cape Cod in Massachusetts.

The official NHC forecast has Earl reaching the North Carolina coast tonight as a category 4 hurricane before veering to the northeast, staying offshore and avoiding direct landfall while making its way up the Eastern Seaboard. Tropical storm-force winds are expected to be felt along parts of the North Carolina coast later today, with the potential for hurricane-force winds to hit the area by tonight. Looking further ahead, the NHC expects tropical storm-force winds to reach Virginia and New Jersey tomorrow (September 3) before making possible landfall over Nova Scotia in Canada on September 4. Forecasters said Earl will make its closest pass to New Jersey on Friday afternoon as a category 2 hurricane.

According to the official NHC forecast, Earl will be a category 4 hurricane at its closest point to North Carolina. Based on the NHC forecast track, EQECAT said it expects Earl to cause insured losses of less than USD100 million. EQECAT added losses could approach USD500 million if the hurricane moves closer to the U.S. mainland. However, forecasters continue to caution that it is still too early to judge how close Earl may come to land. Although the forecast models are in general agreement on Earl’s track forecast, it is important to note that there is still significant uncertainty in the prediction. There is a large cone of uncertainty associated with Earl’s extended forecast and the storm could potentially hit northern regions of the U.S. should the track deviate to the west.

On the U.S. mainland, the governors of North Carolina, Virginia and Maryland have declared states of emergency and federal authorities have cautioned all residents on the East Coast to prepare for potential evacuations. On its present course, Earl could unleash powerful waves of up to 20 feet (6 meters) along the coast and cause potential flooding problems, forecasters said. Due to the uncertainty over Earl’s forecast track, authorities are preparing from a “worst case” scenario and mandatory evacuations have been ordered for 30,000 residents and visitors on Hatteras Island on the Outer Banks. About 5,000 tourists were ordered to leave Ocracoke Island to the south, and officials in Carteret County are evacuating low-lying areas. Elsewhere, National Guard troops have been deployed in North Carolina and Virginia while officials on Cape Cod braced for their first major storm 1991.

Earlier in the week, Earl skirted the northern Leeward Islands, causing moderate damage. Anguilla was hit by hurricane-force winds, ripping roofs off buildings and downing trees and utility poles. The strength of the winds recorded on Anguilla triggered its hurricane coverage of the Caribbean Catastrophe Risk Insurance Facility (CCRIF). The CCRIF says it plans to payout USD4 million to Anguilla’s government. Although Antigua & Barbuda and St. Kitts & Nevis reported some flooding and coastal damage, there is no indication from CCRIF that policies in these countries have been triggered. Elsewhere, St. Martin and the Virgin Islands were hit by tropical storm-force winds, causing minor damage. Disruption and damage was also reported in St. Maarten and Puerto Rico. In total, AIR Worldwide estimates Earl caused insured losses of between USD50 million and USD150 million as it passed the northern Leeward Islands. The estimate includes wind damage to onshore properties in the Virgin Islands, St. Maarten, St. Martin and Puerto Rico. AIR estimates that up to 50 percent of losses are from St. Maarten, where high winds caused roof damage to buildings and toppled trees and power lines.

Sources: National Hurricane Center, WSI, Agence France Press, Associated Press, Reuters News, CNN News, BBC News, MarketWatch

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Guy Carpenter’s Instrat® department provides CAT-i reports for major natural catastrophes worldwide. These reports cover catastrophes including worldwide tropical cyclones, earthquakes, major UK and European floods and any other natural event that is likely to incur a significant loss to the (re)insurance industry. Please email CAT.i@guycarp.com if you wish to be added to the free email distribution list.

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Hazard data illustrated in the CAT-i map was taken from i-aXs®, Guy Carpenter’s web-based risk management platform. i-aXs users can view impacted areas on any map as well as see how their portfolios were affected. Please contact your broker or Instrat® representative for assistance or go to www.i-axs.info for further information.

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