November 30th, 2021

Atlantic Hurricane Season

BMS Tropical Update - 2021 Atlantic Hurricane Season Insurance Industry Takeaways

By: Andrew Siffert

Every hurricane season is different and offers unique insights for the insurance industry to remember, and the 2021 Atlantic Hurricane season was no exception. This is an attempt to bring light to those aspects.

Storm Count and Overall Activity

The 2021 Atlantic hurricane season generated 21 named storms, the third most recorded in history behind the record set just last year with 30 named storms and the 28 named storms that were observed during the 2005 season. Although this season ended up using the complete alphabet list, the season did not get a chance to use the newly established supplemental named list that was developed to replace the Greek alphabet used in the 2020 and 2005 seasons.

Although there was a high number of named storms, the number of hurricanes this season (7) was right in line with the 1991 – 2020 average of 7.2 storms. The four major hurricanes that occurred were above the 3.2 major hurricanes that are expected in any given year based on the 30-year average.

Here are the forecasts from the start of the season if you want to see how we got the prediction correct. Most forecasts predicted an above-normal season, but few forecast the extreme named storms, which can be explained by the type of named storm activity that was actually observed this season. The overall activity in terms of ACE (Accumulated Cyclone Energy), which is a calculation and metric that accounts for the overall intensity and duration of named storms and a gauge to the overall activity in a given season, can also point to why the named storm forecast was a bust. ACE for the season was 118.4% above-normal this year, which also indicates an above-normal activity for the season. However, in terms of named storm count, a lot of the activity was weak and short-lived. In terms of ACE - Hurricane Larry and Sam contributed 60% of the total seasonal ACE as they both were strong and long-lived hurricanes out in the open Atlantic Basin. Ida only contributed to 7% of the overall seasonal ACE. Overall, 9 of the 21 named storms that formed this season were only around for two days or less and many of these storms would not have been named pre-satellite era.

The lesson here for the insurance industry is that seasonal forecasting is still difficult and there is still little value besides correlating a high number of named storms to higher than normal landfall. This is what matters to the insurance industry and therefore, more focus should be placed on the possible areas of landfall activity than the total number of storms in a given season.

The 2021 Atlantic Hurricane season was marked by 9 storms that lasted less than two days. The total count of these short-lived storms is actually tired 2017 for the most short named storms since the satellite era started in 1968. Also shown in the labels above the bars are the maximum wind intensity and the overall ACE from each storm. Ida points outs out that even though the storm was shorted lived at just four and a quarter days it was one of the strongest storms of the season in the basin.


The last interesting aspect of the 2021 Atlantic Hurricane activity was that Ana, named at the end of May, commenced another year with an early start. This is the 7th consecutive season with a named storm formation before the official start of the season on June 1st, but after the burst of seasonal activity in late September the season abruptly ended on October 5th with only one named storm, Wanda, forming at the end of October from a former Nor’easter. Given the overall activity during the core of the season, a continued La Nina, and warmer than normal sea surface temperatures, this lack of season activity is extremely rare and ultimately shut down. This was likely due to an overall change in the North American weather pattern that brought more consistent troughs of low pressure to the Eastern U.S., which would have increased wind shear across the Caribbean and Gulf of Mexico. This increase wind shear prevented tropical convection in the areas that typically experience named storm formation in the late season.

So Many Landfalling Named Storms

As one might expect, an active hurricane season often correlates with a higher-than-normal expected chance of named storms making landfall; 2021 surely did not disappoint. Of the 21 named storms, 8 of them made U.S. landfall in 2021, beginning with Claudette, which continued the onslaught of storms to impact Louisiana from the 2020 season. Danny and Mindy made landfall but their impacts were negligible and did not even register as a Property Claims Services (PCS)-insured loss event. Tropical storms Claudette, Elsa, Fred, Henri, and Hurricane Nicholas all had insured loss impacts but only contributed to 6% of the seasonal insured loss. In fact, the majority of the insured loss came from Ida, which is evident in the maximum wind gust analysis from our BMS iVision Product below.

BMS iVision and the Verisk Respond product are great resources for the insurance industry in helping to understand wind impacts. This is an overall aggregated summary of all the 2021 wind swath from the landfilling named storms this season. Eight named storms impacted the U.S. this season. Two of these named storms were hurricanes at landfall (Ida and Nicholas). Ida was a very powerful hurricane with wind gusts topping out the scale along the Louisiana coastline, which is indicated in the wind swath map. Henri provided some strong winds into New England and for the third season in a row, the Florida peninsula missed most of the action this year.


What is likely an incredible stat is in the last two years, 19 named storms have made U.S. landfall, which includes 8 hurricanes. Although this year saw about the average number of hurricane landfalls which is 1.6, 8 in the last two years is still considered hyperactive and likely makes up for the lack of U.S. hurricane landfalls between 2006 and 2016. Unfortunately, most of this landfall activity continues to target the Gulf coast with Louisiana in particular. The Gulf coast has experienced 13 hurricane landfalls since 2016 and 5 hurricane landfalls in Louisiana since 2019. In terms of landfalls, the East Coast is entering into what some might call a drought of landfalls. This includes the only four hurricane landfalls since 2016 and Hurricane Bob in 1991 being the last hurricane to make landfall in New England. In fact, the last major hurricane to make landfall along the East Coast of the U.S. North of Florida was Hurricane Fran in 1996, 25 years ago.

The Season Will Be Remembered by Ida Impacts

In general, our weather memory is short. The 2021 Atlantic hurricane season will likely only be remembered by Ida. In fact, it will be interesting to see if Ida becomes the fifth major hurricane to make U.S. landfall. Ida winds were just shy of the wind speed needed to classify as a Category 5 hurricane (156 mph). Like Hurricane Michael in 2018, which was originally classified as a top-end Category 4 hurricane, but upgraded postseason to a Category 5, the National Hurricane Center will review the various observations from Ida. One of these observations was the ship Laney Chouest in Port Fourchon, LA which observed a peak wind gust at 223 mph at a height of 100 feet above sea level. Depending on the reduction and instantaneous gust adjusted down to the standard 10 meter - 1-minute wind speed, there could be enough data here to provide Ida a Category 5 designation. If this is the case, catastrophe modeling firms will have to refigure how this will change the return period of such rare and extreme events.

BMS iVision and the very detailed Verisk Respond 3 second wind gust product have been very useful in helping insurance carriers understand the magnitude of losses and help better analyze claims data to develop damage ratio and better understand future high wind loss events.

Regardless of Ida's final designation it was a devastating and deadly storm and will surely be retired from the list of names used by the National Hurricane Center. Interestingly enough, the “I” named storms far outpace other letters for retirement. The insurance industry should certainly start dreading any of the “I” storms each season since in total 12 of them have been retired since 1953.

Ida's trail of destruction did not end at the coastline. Once again, this served as a lesson for the insurance industry that storms that interact with mid-latitude troughs after landfall can have large impacts. Not to mention, storms cannot just be forgotten about after their landfall. Ida's large swath of rain inland highlighted the need to lower the protection gap that exists with the flood peril in the U.S. However, even with flood insurance, the flooding that occurred in many locations had long historical records. For instance, the Schuylkill River in Philadelphia experienced its worst flood in more than 150 years falling just shy of the highest record that occurred in 1869. A large amount of loss also highlights the large protection gap that exists between the insured and overall economic loss.

Insured losses for Ida are still developing and are currently approaching the $30B mark-making Ida likely a 1 in 6 – 10 year loss event for the insurance industry. The average annual loss of $15B expected in the U.S. 2021 adds to yet another costly year of named storm losses since 2017, making up for the low loss years from 2006 – 2016.

The 2022 Atlantic Season Outlook

In just a few short months, the wealth of seasonal forecast shops will start to release their prognostications for the 2022 Atlantic Hurricane Season. The 2021 season burned through the alphabet and most storms this season were weak and short-lived. Overall, the Atlantic basin saw four major hurricanes, which are in line with what to expect in any given year based on the last 30 years' climatology. If you removed the short-lived storms of the 2021 season, 12 named storms would remain. Are we seeing the beginning of a new Multi-decadal quiet period? The calendar would suggest the basin should be approaching the end of the Atlantic Multidecadal Oscillation (AMO) which started around 1995. The tail end of the 2021 season showed it takes much more than a La Nina and warm sea surface temperatures to make the perfect season. Too much vertical wind shear and dusty and dry air during the wrong time of year can also stop a season in its track.

At this point in time, it is far too early to understand what might happen with the 2022 Atlantic Hurricane season. The leading factors likely to be talked about going into the 2022 season are the strong La Nina in the Central Pacific combined with the strong cold signal of the Pacific decadal oscillation. The climate model continues to suggest warmer than normal sea surface temperatures in the Atlantic next summer. One thing is certain, we cannot connect 1 year like 2021 to any “New Normal” of what could occur in the basin next year. If that was the case, we would already know what to expect, which we do not.