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Quiet Atlantic Storm Season Humbles Forecasters

By Brian K. Sullivan | September 25, 2013

The 2013 Atlantic hurricane season is humbling forecasters by shaping up as the first in almost two decades without a major storm, confounding predictions that it would be more active than normal.

It’s been two weeks since the season’s statistical peak and just days are left in its busiest month. With the Atlantic full of dry air and storm-killing winds, there isn’t anything in sight that poses a threat to the U.S. or to oil and gas production areas in the Gulf of Mexico.

Except for Tropical Storm Andrea, which formed in the Gulf of Mexico in June and crossed Florida to New England, contributing to the deaths of four people, the U.S. has been spared a hit. Last year, four tropical systems struck, including hurricanes Isaac and Sandy, which together caused more than $52 billion in damage and killed at least 179 people.

“The season looks to be a huge bust,” said Phil Klotzbach, lead author of Colorado State University’s annual storm forecast. “That’s one of the fun things about being in the weather business. It definitely keeps you humble.”

Colorado State, which pioneered seasonal hurricane outlooks, in August predicted an above-average 18 storms, eight of them hurricanes and three of them major systems. The National Oceanic & Atmospheric Administration said there was a 70 percent chance for 13 to 19 storms, six to nine of them hurricanes and three to five of them major.

Making Predictions

The predictions were based on warmer sea temperatures, a strong West African monsoon and the lack of a Pacific El Nino, a phenomenon that can create Atlantic wind shear.

The shear, winds that blow at different speeds or directions at varying altitudes, ripping storms apart, “has been relentless out there” despite the absence of an El Nino, said Matt Rogers, president of Commodity Weather Group LLC in Bethesda, Maryland.

Mid-level relative humidity across the tropical Atlantic, typically about 30 percent, has been down to 20 to 25 percent this year, Klotzbach said.

“It’s been dry out there, and when I say dry, I mean dry,” Klotzbach said. ‘I’m still not quite sure why it’s been as dry as it has.’’

Warmer waters and the African monsoon haven’t been enough to counter the shear and dryness.

If no major hurricane, one with winds of 111 mph or more, forms in the Atlantic this year, “it will be the first time since 1994,” Rogers said.

Last Year

Nineteen named storms grew in the Atlantic in 2012, for the third year in a row. Nine have developed this year, two of which became low-level Category 1 hurricanes, according to the National Hurricane Center in Miami.

Nine is above normal for late September, said Dennis Feltgen, spokesman and meteorologist at the center. Mexico was battered this month on both coasts by storms that killed at least 100 and left 68 missing.

The 30-year average for the six-month season is 12 storms with winds of 39 miles (63 kilometers) per hour or higher.

This year’s first hurricane, Humberto, was born at 5 a.m. New York time on Sept. 11, just missing the record for the latest such a storm formed since satellites began watching the entire Atlantic in 1967, Feltgen said. In 2002, Hurricane Gustav developed at 8 a.m. that day.

Humberto disintegrated in the central Atlantic. Storms Chantal, Dorian, Erin and Gabrielle all dissipated when they ran into the wind shear and dry air, Feltgen said. Several potential storms, called tropical waves, never got a chance to develop.

Bay Storms

“One of the few areas that have been marginally favorable for development is the Bay of Campeche and southwest Gulf of Mexico,” Feltgen said.

Andrea formed there, as did Barry, Fernand and Hurricane Ingrid, all of which hit Mexico.

The calmer weather has offered a reprieve for U.S. property insurers. The companies are also benefiting from rate increases they pushed through as claims costs rose and low interest rates reduced income from bond portfolios that back policyholder liabilities.

Travelers Cos. Chief Executive Officer Jay Fishman said this month that his company bought back $633 million of its stock since June 30 amid lower natural disaster losses. That’s the highest amount for the insurer in a third quarter since it was formed by the 2004 merger of Travelers Property Casualty Corp. and St. Paul Cos.

“The third quarter, as everyone knows, has been benign and quiet from a windstorm perspective,” Fishman said Sept. 11 at an investor conference in New York hosted by Barclays Plc.

Season’s End

Dan Kottlowski, a meteorologist at AccuWeather Inc. in State College, Pennsylvania, said wind patterns are setting up that will prevent any storms from developing close to or threatening the U.S.

“We have never seen a storm make landfall on the Texas coast past the middle of October,” Kottlowski said. Weather fronts begin sweeping across Texas and push storms away from that state as autumn takes hold in the Northern Hemisphere, he said.

It also becomes harder for a storm to strike the main oil and gas production areas in the Gulf, Rogers said. The waterway is home to about 23 percent of U.S. crude production, 5.6 percent of gas output, and more than 45 percent of petroleum refining capacity, according to Energy Department data.

“After the first week of October, it’s very hard to get a system into the production area of any significance,” Rogers said.

Still Time

Feltgen cautioned against writing off the season, which officially ends Nov. 30.

“Many past seasons with similar climate factors have produced four or more named storms and four or more hurricanes after mid-September, which would bring the 2013 season totals in line with the ranges in NOAA’s outlook,” Feltgen said.

Last year, Hurricane Sandy was born on Oct. 22.

“I always say,‘never say never’ in the tropics, but I think the odds are diminishing pretty rapidly for the season,” Rogers said.

Klotzbach said conditions across the Atlantic are only going to become worse for storms in the next few weeks.

“I really don’t see any comeback, and we’ve really only got three or four weeks before the season really starts winding down,” he said.

–With assistance from Nacha Cattan in Mexico City, Moming Zhou, Christine Harvey and Noah Buhayar in New York and Barbara Powell in Houston. Editors: Charlotte Porter, Dan Stets

Atlantic Hurricane Season Quietest in 45 Years, Experts Say

The 2013 Atlantic hurricane season looks set to go down as a big washout, marking the first time in 45 years that the strongest storm to form was just a minor Category 1 hurricane.

There could still be a late surprise in the June 1-Nov. 30 season, since the cyclone that mushroomed into Superstorm Sandy was just revving up at this time last year.

But so far, at least, it has been one of the weakest seasons since modern record-keeping began about half a century ago, U.S. weather experts say. Apart from Tropical Storm Andrea, which soaked Florida after moving ashore in the Panhandle in June, none of this year’s cyclones has made a U.S. landfall.

That meant relief for tens of millions of people in U.S. hurricane danger zones. But 2013 has been a bust for long-range forecasters who had predicted a stronger-than-usual burst of activity in the tropical Atlantic.

It has been “a very strange sort of year” in the unpredictable world of cyclones, said Jeff Masters, a hurricane expert and director of meteorology at Weather Underground.

“We’ve been in this multi-decadal pattern of activity but it just didn’t happen this year,” Masters said, referring to the prolonged period of increased hurricane activity that began in 1995.

That period is still playing out, fed primarily by warm ocean temperatures in the tropical Atlantic that fuel hurricanes. But instead of increased activity, 2013 almost seems like a year when an enormous tranquilizer dart was fired into the heart of the main breeding ground for hurricanes.

A confluence of factors, including abundant sinking air and dry air, and possibly dust flowing out of North Africa’s Sahara desert, kept a lid on hurricane formation in 2013, according to many cyclone experts.

That wreaked havoc with most leading seasonal forecasts like the one issued by Colorado State University on Aug. 2. The errant forecast said 2013 would see above-average activity, with eight hurricanes and three that would develop into major hurricanes of Category 3 or higher on the five-step Saffir-Simpson intensity scale.

An average season has six hurricanes and three major hurricanes. But an Aug. 8 outlook from the National Oceanic and Atmospheric Administration called for six to nine hurricanes, three to five of which would become major hurricanes.

There were two short-lived Category 1 hurricanes this year, making it the first Atlantic season since 1968 when no storm made it beyond the first level of intensity, according to theNational Hurricane Center.

It has also been a year marked by the fewest number of hurricanes since 1982 and the first since 1994 without the formation of a major hurricane.

In terms of so-called “Accumulated Cyclone Energy” (ACE), a common measure of the total destructive power of a season’s storms, 2013 ranks among the 10 weakest since the dawn of the satellite era in the mid-1960s, said Dennis Feltgen, a spokesman for the Miami-based National Hurricane Center.

“The ACE so far in 2013 is 33 percent of normal,” he said.

State lawmakers propose solution to flood insurance crisis

Posted on Tuesday, 12.17.13

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Florida Senate bill filed Tuesday seeks to alleviate skyrocketing federal flood insurance premiums by setting up a competing — and hopefully cheaper — state-run market.

The bill, sponsored by Sen. Jeff Brandes, R-St. Petersburg, would invite private insurers to enter the market by creating a new regulatory system just for flood insurance. It would evaluate rates, risks and a company’s financial strength.

Over the last 35 years, Florida homeowners paid four times more in National Flood Insurance Program premiums than they collected in claims. Despite that, many of the older homes in low-lying areas now face sharply higher rates under new Congressional mandates. In some cases, rates are jumping from a few thousand dollars to $15,000 or more.

“I have to believe the private market could make a profit at those prices,’’ Brandes said Tuesday at a news conference.

He and other state legislators jumped into the fray because the Florida Congressional delegation has not been able to secure a rate hike delay in Washington.

State Rep. Larry Ahern, R-Seminole, plans to file a companion bill in the House, and other legislators around the state have signaled their support, Brandes said.

“We hope to have this bill to the governor’s desk early in the session,’’ he said. “It is designed to go into effect immediately,’’ he said, unlike most new laws, which take effect in July.

Many mortgages written in Florida require homeowners to carry flood insurance, almost all provided by the national program. A Congressional overhaul last year zeroed in on hiking rates for older properties that have enjoyed lower rates for decades.

In some cases, rates in flood zone areas will rise about 20 percent annually until they reflect what the federal government deems the proper market risk.

But under certain conditions — such as when a home is sold — the new owner must pay the full market rate immediately, possibly tripling or quadrupling the premium.

“It has killed the real estate market,’’ said Treasure Island Realtor Shirley Madden, who attended the news conference.

One Tampa-based insurer, Homeowners Choice Property & Casualty Insurance, has already jumped into the market by taking care of existing customers.

Beginning Jan. 1, Homeowners Choice will start adding flood endorsements to its homeowners policies. The company has about 140,000 policyholders statewide, but is starting out slowly with this new line of business.

“We’ll probably do the first 3,000 flood policies and see how it goes. Then do the next 3,000,” CEO Paresh Patel said. “It’s a very measured approach. We’re not going to write everybody.”

Patel said 3,000 policies represents about $1 billion in exposure. “Once we get comfortable about the first billion, we can talk about the next billion,” he said.

He estimated the maximum rate of coverage for a property with $250,000 in building coverage and $100,000 in content coverage would be just over $3,000 in an “A” flood zone and about $6,800 in a “V” flood zone.

Homeowners Choice won special approval for its product, said Ron Lehmann, spokesman for the R Street Institute, a think tank that monitors the insurance industry.

The Brandes bill would set up a complete regulatory framework for all flood carriers. Among other things, it would add an engineer who specializes in flood plains to a state board that oversees rate setting, as well as a meteorologist with expertise in floods.

Private insurers could not compete with the federal program when it was subsidized, Lehmann said.

“But if the government is offering real actuarial rates,’’ he said, “that is something our companies can match.’’

The Florida legislation also would add flexibility to the marketplace, Lehmann said. Insurers would not have to offer content coverage, for example, or temporary living expenses if a home was destroyed. Coverage could be pegged to the mortgage amount, not the total replacement cost.

That would be welcome relief for Verla and Richard Waldo, a Seminole couple facing much higher flood rates next fall.

The Waldos, who moved into their 864-square-foot, two-bedroom home in 1997, have whittled their mortgage balance from $75,000 to nearly $40,000.

Verla Waldo, 73, said she had a letter from her bank saying it would be satisfied with $41,600 in flood coverage — enough to cover the remaining mortgage — but her insurance agent insisted that the national program now requires full replacement value, or $111,000 in coverage.

“They’re saying that I can’t say how much coverage I want,” she said. “I’d like to know when my rights were taken away from me.”

Senate moving to ease flood rate pain

By Lloyd Dunkelberger & Jeremy Wallace

TALLAHASSEE – With one senator calling it Florida’s “most talked-about problem,” state lawmakers on Wednesday moved to entice private companies into a flood insurance market that has been dominated by a federal program.

The Senate Banking and Insurance Committee unanimously backed a bill (SB 542) that would encourage more private insurers to offer an alternative to the National Flood Insurance Program by giving the companies more freedom to set rates and shape coverage plans.

“Ultimately this bill puts consumers in control,” said Sen. Jeff Brandes, R-St. Petersburg, the bill’s sponsor.

Brandes filed the legislation in response to escalating premiums in the federal program, which provides coverage for 2 million Floridians. Some 269,000 of those policies that receive subsidized rates could face substantial increases under a new federal law aimed at shoring up the NFIP.

Efforts to block the NFIP rate escalation have so far been stymied in Congress, but glimmers of hope emerged in Washington on Wednesday.

In the Senate, Democrats are pushing for a vote on a bill as early as next week that would delay the increases for many homeowners for up to four years.

But that bill’s prospects in the House are uncertain. Both chambers must agree for the delay to be instituted. In the U.S. House, a bill to delay the rate increases for 15 months appeared to have more momentum, though it is uncertain when, or even if, that legislation would be scheduled for a vote.

Brandes said regardless of what happens in Washington, Florida lawmakers need to proceed with a private-sector plan.

“Hoping Congress will act is not a strategy we can rely on,” Brandes said. “We need a strong alternative.”

Brandes said his bill would allow private insurers to provide “more choices” for flood coverage, including allowing homeowners to decide whether to opt for coverage for the full replacement cost of their homes or the mortgage amount or its actual cash value. It would also allow homeowners to limit coverage to the main house structure or opt not to cover personal property.

Insurance companies would have more freedom to set rates, although they could use the standard rate review process. One option would include a “consent” agreement with the homeowner on the rate amount.

Brandes said the rates set by the NFIP would act as a “ceiling” for the private insurers’ rates. But he said he believed there was an opportunity for companies to offer competitive, actuarially sound rates in cases where homeowners are now facing annual insurance costs of $30,000 or $40,000 in the federal program.

Sen. Nancy Detert, R-Venice, voted for the bill, warning that Florida could face another housing crisis unless it is addressed.

“This is the most talked about problem in the state of Florida today,” Detert said. “We as a state cannot afford to go through another real estate bust when we’re just now coming out of one.”

But Detert also added a note of caution, saying the legislation provides no guarantee that private insurances will jump into the market or the rates they offer will help consumers. She noted that the state has been trying for years to entice more private insurers into the property market to reduce the size of the state-backed Citizens Property Insurance with limited success.

She said one of the biggest problems impacting flood insurance rates are outdated maps used in the federal program.

Brandes said he is looking at an option in which the state could begin developing its own maps, although he noted it would come with a cost.

Sen. Alan Hays, R-Umatilla, voted for the bill but said he wanted a prohibition in the legislation blocking Citizens from offering flood insurance properties. The bill next heads to the Senate General Government Appropriations Subcommittee headed by Hays.

Sen. Garrett Richter, R-Naples, said “the most responsible way to reduce premiums” is to expand the size of the flood insurance market. “I think we’re on the right track,” he said. “This is a good bill.”

A similar bill is expected to be filed in the House by Rep. Larry Ahern, R-Seminole.

More Citizens changes proposed

By Lloyd Dunkelberger , Herald-Tribune
/ Tuesday, January 14, 2014


In a renewed effort to reduce the size of the state-backed Citizens Property Insurance, lawmakers are turning their attention to policies for condominiums, apartment complexes and commercial property.

Senate Banking and Insurance Chairman David Simmons, R-Altamonte Springs, on Tuesday outlined proposals that would move many of those policies out of Citizens and into private insurance companies.

The proposals include a plan to use the new Citizens Clearinghouse, which this month will begin offering private policies to Citizens’ residential customers, to also cover condominiums, apartments and other commercial residential properties.

Another would cap coverage of condo complexes at $10 million. The commercial residential properties currently have no cap and Citizens is covering some 323 buildings — many likely beachfront towers — valued at more than $25 million.

The bill would also remove the 10 percent annual cap on premium increases from commercial properties insured by Citizens, allowing the rates to increase more rapidly to a level considered more “actuarially sound.”

Building on a major Citizens bill passed last year — which included the clearinghouse provision for homes — Simmons said the new measures were aimed at reducing “a significant amount” of potential liability for Citizens if the state is struck another major hurricane. A further reduction in Citizens’ size would also reduce the potential for assessments on all Florida insurance policyholders if they have to make up a deficit in the state-backed insurer.

Citizens President and CEO Barry Gilway said the insurer supported expanding the clearinghouse to other properties. He said Citizens has made “huge progress” in reducing its storm exposure, dropping from $510 billion in recent years to $330 billion.

Condominiums and other commercial residential properties represent some $93 million of that remaining exposure, he said.

The clearinghouse for homeowners is scheduled to start by Jan. 27, with four private carriers offering policies to Citizens’ customers, Gilway said. Under the law, new Citizens customers have to accept private coverage if the clearinghouse premiums are within 15 percent of the government-backed policies, while existing customers who renew their policies will be moved to private companies if the rates are equal or lower than the Citizens’.

More private companies are expected to join the clearinghouse in the coming year, Gilway said.

But Gilway said it would take about 18 months to add the commercial residential policies to the clearinghouse, because the policies are more complex than homeowner policies.

Sen. Gwen Margolis, D-Miami, who represents many coastal properties in her Miami-Dade County district, questioned the impact on condominium owners and coastal businesses.

“I’m just concerned until I see some numbers,” Margolis said.

Sen. Nancy Detert, R-Venice, said removing the annual premium cap for commercial non-residential buildings could also impact condominium owners since common buildings, such as a clubhouse, would fall into that category and rate hikes would be passed on to members of the condominium association.

But Detert also acknowledged the need to continue to reduce Citizens, designed as the “insurer of last resort” but expanded as lawmakers responded to a devastated insurance market following a series of hurricanes.

“I think we need to gird our loins and prepare for screams from people who will be affected,” Detert said. “But rate is based upon risk…If you’re sitting on the beach you’re more at risk than the people in Arcadia. We are not going to make everybody happy on this.”

Sen. Tom Lee, R-Brandon, a former Senate president, reminded his colleagues that lawmakers had a hand in keeping Citizens’ rates affordable. He said the Senate needs to “be sensitive to both the political and the economic implications of this.”

He suggested if a law is passed, it could take effect on Jan. 1, which would be “a more appropriate date for some people” and would also put it past November’s general election.