Which way will the wind blow?

Allianz Commercial Hurricane season outlook 2020

As another hurricane season is about to begin in the Atlantic basin, what kind of season will it be? After successive above-average seasons since 2016, what are the projections for 2020? Will a La Niña year materialize to strengthen hurricane production? The Allianz Global Corporate & Specialty (AGCS) Catastrophic Risk Management team reviews the 2019 season and previews 2020, based on projections from key hurricane forecasting institutes and observations by its in-house catastrophe risk team.

The 2020 Atlantic hurricane season begins on June 1 and ends on November 30. The Atlantic basin had three quiet hurricane seasons from 2013 to 2015, followed by above average seasons ever since. The 2019 Atlantic hurricane season ended up being slightly above average and will primarily be remembered for hurricane Dorian, which devastated the northwestern Bahamas at Category 5 intensity with a forward motion of less than 5mph for the 27 hours it spent at category 5 strength. It further impacted the southeastern United States, and also caused significant damage to the Atlantic Provinces of Canada. At its peak, Dorian had sustained winds of 185mph (298kph) with gusts to 220mph (354kph), causing some to suggest it was among the world’s few “category 6” hurricanes in history, meaning that its wind speeds exceed the limitations of the Saffir-Simpson Hurricane Wind Scale [1]. At present, the established research institutes anticipate a slightly above average 2020 Atlantic basin hurricane season. Scientists from Colorado State University (CSU), Tropical Storm Risk (TSR) and AccuWeather forecast above normal activity. 

Extreme meteorological events such as hurricanes have the potential to generate significant onshore and offshore losses for the insurance industry. Two such past events – Hurricane Katrina in 2005 and Hurricane Harvey 2017 – belonged to the costliest storm events (in terms of insured losses) in US history [2]. Due to the high impact of hurricanes making landfall, the AGCS Reinsurance and Catastrophe Management team annually provides an outlook of the upcoming hurricane season. This article reviews the 2019 season activity compared to its predictions and provides an outlook for the upcoming 2020 season.

The 2019 hurricane season overall was slightly above average but not comparable to the record activity of 2017. The season counted 10 hurricanes, out of which six reached a major hurricane status. With  three major hurricanes (category 3–5) in the Atlantic, 2019 was close to the long-term average (2.7). However, the number of named storms (18) significantly exceeded the average (12) and marks the ninth Atlantic hurricane season on record (since 1851) with 18+ Atlantic named storms [3]. Overall losses in the US during the 2019 season were $3bn, of which $2bn were insured. Due to the lack of severe hurricanes, the US share of global natural catastrophe losses were lower than normal – 31% of overall global losses compared with the long-term average of 35%) [4].

The climatological peak months of last year’s (2019) hurricane season started off with a quiet August. September was very active and the main driver of the 2019 Atlantic hurricane season. October was characterized by above-average named storm activity but below-average hurricane activity [5].

The 2019 Atlantic hurricane season will primarily be remembered for Hurricane Dorian, which devastated the northwestern Bahamas at Category 5 intensity and further impacted the southeastern United States. Tropical Storm Imelda also deluged southeast Texas with tremendous amounts of rainfall, causing considerable damage in the process [6].

Exceeding the previous record of Hurricane Irma in 2017, Dorian is considered to be the strongest hurricane ever recorded in the open Atlantic, outside of the Caribbean and Gulf of Mexico. After crossing the US Virgin Islands as a category 1 hurricane on August 28, Hurricane Dorian rapidly intensified into a category 5 hurricane and made landfall on the Bahamas Great Abaco Island on September 1 with peak wind speeds of about 180mph (290kph). Hurricane Dorian is the strongest hurricane on record to make landfall in the Bahamas.  In addition to its fierce wind, Dorian brought an estimated storm tide of up to 25ft (7.6m) and released up to 39in (1000mm) of rain over the Bahamas. Dorian was downgraded to a category 2 storm as it began moving north towards North Carolina. Originally, it was feared that it would hit the southeast coast of the US, but a more northerly and easterly track largely spared the US mainland. Dorian again made landfall in the Atlantic Provinces of Canada on September 7. Total economic losses attributed to Dorian were about $5.6bn, with $4bn in insured losses [7].

Tropical cyclones that are very destructive and/or deadly can be retired by the World Meteorological Organization (WMO) from future Atlantic tropical cyclone name lists, which otherwise are repeated every six years. Through 2018, nearly 90 Atlantic hurricane or tropical storm names had been retired. Despite its disastrous 2019 impacts, Dorian will not be the latest addition to the retired list for now. The WMO usually holds a weeklong meeting every spring to consider deleting a name, but, due to the ongoing COVID-19 pandemic, this year's meeting was turned into a shortened videoconference which did not leave room for discussion about the potential retirement of any names from the 2019 Atlantic hurricane season. Dorian might be eliminated in spring 2021 when the next meeting will take place [8].

At the beginning of the season, there was a general agreement among the forecasts by CSU, National Oceanic and Atmospheric Administration (NOAA) and Tropical Storm Risk (TSR) that hurricane activity was likely to be near average in 2019. Later, these forecasts were downgraded, ultimately underestimating the Atlantic hurricane number of named storms while the forecasts for number of hurricanes and major hurricanes did not change significantly during the course of the year and were fairly accurate across most institutes. According to CSU, the primary reason for the underestimate was due to a more rapid reduction of the weak El Niño conditions than was originally expected. 

The initial extended-range forecast of the Atlantic seasonal hurricane activity for 2020 by CSU describes the following factors that lead to the conclusion of a slightly above average season.

El Niño and La Niña are opposing phases of what is known as the El Niño-Southern Oscillation (ENSO) cycle. The associated complex weather patterns result from variations in ocean temperatures in the equatorial Pacific. ENSO has an influence on the hurricane formation both in the Atlantic and the Eastern Pacific Basin. El Niño (warm phase) is based on warmer than usual sea surface temperatures in the equatorial Pacific. Simply put, El Niño favors stronger hurricane activity in the central and eastern Pacific basins, and suppresses it in the Atlantic basin. Conversely, La Niña which is characterized by colder temperatures in the equatorial Pacific, suppresses hurricane activity in the central and eastern Pacific basins, and enhances it in the Atlantic basin. These impacts are primarily caused by changes in the vertical wind shear and changes in wind speed and direction between roughly 5,000 to 35,000 ft. above the ground. Strong vertical wind shear can suppress a developing hurricane [9].

Current warm neutral El Niño conditions appear likely to transition to cool neutral El Niño or potentially even weak La Niña conditions by this summer or fall of 2020. The tropical Atlantic is warmer than normal, while the subtropical Atlantic is quite warm, and the far North Atlantic is anomalously cool. The anomalously cold sea surface temperatures in the far North Atlantic lead us to believe that the Atlantic Multi-decadal Oscillation (AMO) is in its negative phase. The AMO is correlated to air temperatures and rainfall over much of the Northern Hemisphere, in particular in the summer climate in North America and Europe, and is also associated with changes in the frequency of North American droughts and is reflected in the frequency of severe Atlantic hurricane activity. The cold phase of the AMO is associated with low-activity eras (such as the period 1971-1994). A key atmospheric feature of the corresponding AMO warm phase is a stronger West African monsoon. Although, a cold far North Atlantic is typically associated with a cold tropical Atlantic, that has not occurred this winter and consequently most of the tropical Atlantic is warmer than normal [10].

It is assumed that the cold phase of the AMO with above normal tropical Atlantic sea surface temperatures is not able to counterbalance the effect of the weak La Niña in this upcoming hurricane season. Therefore, an above-average probability for major hurricanes making landfall along the continental United States coastline and in the Caribbean is anticipated.

The skill of hurricane season forecasting increases as the peak of the Atlantic hurricane season approaches, with uncertainty dropping.

The table below summarizes the predicted number of storm events for 2020 by several meteorological organizations. Regarding the predicted numbers of tropical storm events, taking all predictions together, the 2020 hurricane season is expected to be slightly above the long term average (1950-2019), with 14 to 18 tropical storms forecasted. An above average season is indicated by seven to nine storms reaching hurricane strength and two to four becoming major hurricanes. The predicted numbers for storms and hurricanes making landfall in the US by Tropical Storm Risk (TSR) and AccuWeather are above the long-term norm with two hurricane landfalls. However, those predictions are associated with even higher uncertainties which is why most institutes refrain from issuing Hurricane landfall projections. It should be stressed that the precision of hurricane outlooks issued in early April is low, and thus that forecast uncertainties remain large for the 2020 hurricane season. These uncertainties apply already to the underlying projections for the El Niño Southern Oscillation and the North Atlantic Oscillation [11].