Tropical cyclone of enormous strength

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Tropical cyclone of enormous strength over the North Atlantic

Hurricane Matthew devastated the Caribbean and brushed the southeast coast of the USA. It was the first Atlantic hurricane for almost ten years to reach the highest Category 5 status.

With wind speeds of up to 250 km/h, Matthew first raged through the Caribbean, sweeping across Haiti, Jamaica, Cuba and parts of the Dominican Republic. The western part of Haiti was the region worst affected. After making landfall on 4 October, Matthew left in its wake stretches of land and localities in this extremely poor country that were completely destroyed. Hundreds of people were killed and much of the the harvest in the southwest of Haiti was wiped out. The hurricane represented a humanitarian catastrophe for the country, which had been devastated by a severe earthquake as recently as 2010. The situation was exacerbated by contaminated drinking water and the resulting cholera epidemic.

The impact of Matthew clearly illustrated the threat that natural catastrophes pose for people in poor countries. Overall losses on the island came to approximately US$ 1.4bn. While this is a manageable amount for industrial countries, it is a devastating loss for Haiti, representing 16% of its gross domestic product. Only an extremely small portion of this was insured. But Haiti is a member of the Caribbean Catastrophe Risk Insurance Facility (CCRIF), a public-private partnership insurance pool. To support national efforts in the area of risk management, the Caribbean Development Bank has been paying Haiti’s CCRIF insurance premiums over the last few years. Just a few weeks after the catastrophe, the CCRIF paid the country US$ 23.4m. Munich Re participates in the CCRIF as a reinsurer.

Matthew was less destructive than expected on its onward path towards the Bahamas and the southeast coast of the USA. The predicted direct hit on Nassau, the biggest population centre on the Bahamas, did not materialise. In New Providence and Grand Bahama, the storm surge and volume of rainfall were smaller than expected. In Florida, Matthew did not pass directly over the coastline, but only brushed it in passing. However, as a precautionary measure, a state of emergency was declared in several US states. Around 11 million people had to leave their homes, and some 1 million were temporarily without electricity. It was a blessing that Matthew remained mostly over the ocean as it tracked northwards. It did not make landfall with high wind speeds, and it did not track along the coastline, which could have caused terrible damage. Nevertheless, losses totalling billions resulted on the Bahamas and in the USA, in particular from the heavy rainfall and the resulting flooding.

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