Insurance industry sees spat of floods in Canada
Toronto, Canada’s largest city and the provincial capital of Ontario, has fallen victim to devastating flash floods that could have a prominent impact on the insurance industry. Catastrophe modeling firm AIR Worldwide has released a new report concerning the flash floods and the impact that have had on the city. The report notes that in a matter of hours, powerful storms produced more than 4 inches of rainfall on July 8th, leading to unexpected flooding in many parts of the city.
Flood disasters have been frequent in first half of 2013
Floods have become one of the most prominent disasters faced by the insurance industry as a whole so far this year. The first half of 2013 has been filled with flooding disasters that have tested the limits of the insurance industry’s ability to meet the needs of consumers. Given the fact that many insurers try to distance themselves as much as possible from floods, the financial implications of these disasters can be quite severe. The flash floods in Toronto are the second of such disasters that have struck a major Canadian city, with a similar event striking Calgary as well.
Power outages affect more than 300,000 people
According to AIR Worldwide, powerful storm sparked flash floods that caused a major power outage in Toronto, affecting some 300,000 people. The entirety of the city’s public transit system was also suspended for several hours due to the flooding. Major roads and thousands of vehicles were submerged and numerous flights out of the city were canceled due to the disaster. AIR Worldwide has not yet issued an estimation of the damage caused by the floods or how the insurance industry may respond to the disaster.
Insurance industry could deal with auxiliary effects of floods
Though the insurance industry is quick to separate itself from flood damage, it is not beyond the reach of the other problems that can be caused by such disasters. Floods do not only cause damage to property, of course, as they also cause significant interruptions to business. These interruptions are something that the insurance industry does usually account for where natural disasters are concerned. Power outages are also something that can cause significant problems that are generally covered by the insurance industry to some degree.