Beryl Final Chapter – U.S. Landfall
Late last night, Hurricane Beryl regained hurricane intensity about five hours before making landfall this morning at 4 AM CDT, local time, near Matagorda, Texas, which has a population of 383 people. This is the first U.S. landfalling tropical system of the 2024 Atlantic Hurricane season.
Hurricane Beryl's journey is a unique one. It left the African coast as an easterly wave on June 25th, became the season's second named storm on June 29th, the season's first hurricane on June 30th, and the first major hurricane also on June 30th. Today marks the final chapter in its historic 13-day journey from Africa to the U.S. With a landfall pressure of 979 mb and wind speed of 80 mph, Beryl was a modest Category 1 landfall. However, it should be noted that Beryl was a strengthening hurricane, which likely enhances the impacts to the insurance industry. In fact, some storm chasers on social media stated that Beryl “felt” much stronger in Texas than it did at landfall in the Yucatan near Tulum. In general, everyone should let out a sigh of relief, not that Beryl will finally be done, but that it ran out of room to strengthen.
Beryl's Winds
The radar shows a broad swirl of heavy rain and thunderstorms. This is providing powerful wind gusts all the way into the Houston metro area, with several stations having recorded wind gusts of 80 – 90 mph on the east side of Beryl’s track. In fact, the Houston Hobby Airport had a wind gust of 74 mph. With that being said, a weather station near Collegeport, Texas, on the left side of the track, had reported an 80 mph wind gust. The highest wind gust thus far as of this posting appears to be at a weather station in San Benard National Wildlife Refuge with a 91 mph wind gust.
As highlighted yesterday, the landfall areas with the strongest winds are very rural, with a total population of 435,297 people. This will limit severe impacts on the insurance industry, which should only be scattered damage and damage to more vulnerable structures such as billboard signs.
The bigger issue for the insurance industry might be that as Beryl intensified toward landfall, this wind field expanded. This has resulted in tropical storm-force winds in the Houston area, which is the fifth largest city in the U.S. with a population of just over 7 million. The question then becomes how insurance policies will respond. Overall, there are higher wind-only deductibles, and overall deductibles have been on the rise, with many homeowners’ policies increasing the mandatory minimum wind hail deductible to 2% of the dwelling amount.
However, we also know that strong winds in these major metro areas can add up. The May 16th derecho that impacted the Houston areas resulted in $70M of insurance loss. During this derecho event, about 1 million customers were without power. As of this morning, only 2.3 million customers were without power across the state of Texas.
Beryl's Flooding
As these updates have pointed out over the past several days, the metro area has a major flooding problem. Urban development has added impervious surfaces, intensifying runoff with excessive rainfall, which seems always to alway cause problems for the Houston metro area. As much as 8 inches of rain is expected to occur as Beryl swipes past Houston, creating localized flooding problems for the metro area. Take note, however, that the recent flood experience has resulted in some of the highest NFIP take-up rates in the U.S., with most counties having a take-up rate of at least 5% and counties like Galveston having a take-up rate of over 25%. Nonetheless, there is still a large protection gap, resulting in many without flood insurance across the region.
The rain, however, does not just stay in Texas. As Beryl tracks inland, it will turn into an extratropical cyclone, taking what seems to be a similar path to the solar eclipse of April 8th, 2024. This cyclone will provide a huge swath of rain up into the middle part of the country into the Great Lakes, with many states along its path seeing 2-4 inches of rain in the next three days.
Storm surges seem to have been manageable for much of the areas. Most of the storm surge is within the intertidal zone. Respectively, if you are using the NHC storm surge inundation maps, make sure to have this layer on to see the actual impacts of storm surge on non-intertidal areas, but also note most of the structures right along the coastline have been elevated to a height of 6- 10 feet above the ground to prevent storm surge flooding. The worst storm surge is expected between Mesquite Bay and San Luis Pass, Texas, and Matagorda Bay, with a 4-6-foot storm surge, which seems to have been verified.
Beryl's Severe Weather
As Beryl moves inland across east Texas, there is a higher chance of tornadoes. Tropical systems often produce tornadoes due to the wind shear. Today, the Storm Prediction Center has outlined areas with a 10% probability of a tornado occurring within 25 miles of a point along the Texas-Louisiana border.
Damage Assessment Insurance Industry Loss
Although it is still early in the overall damage assessment from Beryl as the center sideswipe the Houston Metro areas, it appears this could be a lot worse, and thankfully, dry air and shear prevented major rapid intensification before landfall. Of course, that should not take away from the fact that some will be unlucky; even relatively weak landfalls such as this have the potential to cause pain to individuals and business owners. The big question is, how much damage will be above the higher wind deductibles that are in place? These are typically in place to provide coverage for higher related wind damage as, again, named storm activity in this region is not uncommon, getting brushed or hit by a named storm every 2.6 years. Overall, impacts in the U.S. should not be bad, and overall U.S. insurance industry losses should be between $750M and $1.2B. This is based on historical analogs like recent tropical storm Nicholas (2021) $250M and Tropical Storm Imelda (2019) $700M. The loss estimate also looks at a selection of catastrophe risk model stochastic track event sets. Insurance carriers will likely retain losses, so the losses of Beryl will not likely be a reinsurance event loss.
However, please do not let Beryl U.S. landfall take attention away from the devastation that the Eastern Caribbean suffered, with areas of Grenada and St. Vincent and the Grenadines being nearly wiped out.
What’s Next for the Tropical Atlantic Basin
Through July 7th, the Atlantic has produced 34.61 units of Accumulated cyclone energy, the highest value ever observed year to date on record so early in the season. This already makes up around 30-35% of the seasonal average. A few posts ago, we mentioned that the ECMWF had backed off the seasonal activity; however, if we add the ECMWF's recent 140% projection to this value, we get close to 180% of normal for the season, which comfortably puts the Atlantic basin in an above normal expected activity even without any additional activity through the end of the month.
Through July 7th, the Atlantic has produced 34.61 units, the highest value ever observed for a year on record. However, very little new activity is expected in July. The ACE will flatline until the end of the month, which will still put it above normal for the season but out of record territory.
In various tropical updates, we have provided hints on what to expect for the remainder of July. We have already pointed out several times that no new tropical activity is expected for the next 15 days. This is essentially a result of large areas of dry, dusty air moving across the Atlantic Basin. There is actually a suppression phase of the Madden-Julian Oscillation, which we pointed out was one of the factors that allowed for the burst of activity with Alberto, Chris, and Beryl all forming at the end of June. So, if this MJO is the driving force and is expected every 30+ days, stay buckled up, as we can expect the next round of activity to start in early August.
Above are the last ECMWF ensemble tracks for the next 15 days, which show no large hints of newly named storm activity until July 23rd and event the ECMWF climate model does not show that forecasts out to middle of August shows very little activity, but we did expect some activity at the start of August that the forecast model might not fully understand yet.