Expert Risk Articles

Hurricane Season outlook 2018

The Atlantic hurricane season begins on June 1 and ends on November 30. The Atlantic had three quiet hurricane seasons from 2013-2015, followed by a slightly above average season in 2016 and an extremely active hurricane season in 2017. The majority of meteorological predictions forecast an above-average hurricane season for 2018. However, uncertainties regarding the prediction of the development of El Niño – one of the key variables for tropical storm formation in the Atlantic ocean – has led to high variations among different predictions and high uncertainty.


Hurricanes Katia, Irma and Jose (left to right) on September 8, 2017. Photo: Wikimedia Commons

Extreme weather events such as hurricanes have the potential to generate significant onshore and offshore losses for the insurance industry. Two such events were Hurricane Katrina in 2005 and Hurricane Harvey 2017, which belong to the costliest storm events (in terms of insured losses) in US history (Bloomberg 2018). Due to the high impact of g hurricanes that experience landfall, the AGCS Reinsurance and Catastrophe Management team annually provides an outlook for the upcoming hurricane season. This article reviews the 2017 season activity compared to its predictions and provides an outlook for the upcoming 2018 hurricane season.

Hurricane Season 2017

The 2017 hurricane season was the most expensive on record and ended with 17 named storms, 10 of which reached hurricane status, and six of which reached major hurricane strength. This far exceeds the 2017 hurricane season prediction, which forecast near-normal activity with 12-13 tropical storms, five to six hurricanes and two to three major hurricanes. Hurricane seasons are rated below-, near- and above-average with respect to the historical average number of tropical storms, hurricanes and major hurricanes (Category 3 or above) over the time period 1950-2017. Category 5 Hurricane Harvey (August 25 to September 1) was the costliest storm and global loss event in 2017, with a total insured loss of around $30bn according to Munich RE.

Hurricane Season 2018

Uncertainty regarding the development of El Niño  

One of the phenomena impacting the frequency of hurricanes in the Atlantic Ocean is El Niño which refers to a warming of surface waters in the eastern tropical Pacific ocean. El Niño tends to decrease hurricane activity in the Atlantic Ocean.

For the 2018 hurricane season, scientists from Global Weather Oscillation (GWO) predict above average hurricane activity for three major reasons:

  1. 1. The ocean water temperature continues to stay warmer than normal across most of the Atlantic Basin especially in the Caribbean region and the Atlantic near the US resembling the ocean temperature of last year;

  2. 2. The Bermuda-Azores High Pressure Center will be in a favorable location allowing more named storms to maintain strength moving from east to west across the Atlantic towards the US;

  3. 3. During the spring, weak El Nino conditions will possibly occur, however they could be too weak to dampen the hurricane season.

However, there is a high level of uncertainty regarding the prediction of El Niño formation and the estimation of the effect El Niño will have on the hurricane season. Given these three arguments, there is a 60% chance of an above-normal hurricane season, a 35% chance of a near-normal hurricane season and a 5% chance of a below-normal hurricane season for the Atlantic basin in 2018.

Outlook: Above average Hurricane Season

The table below summarizes the predicted number of storm events for 2018 by several meteorological organizations. Regarding the predicted numbers of tropical storm events, the 2018 hurricane season is expected to be slightly above the long term average (1950-2017), with 14-15 tropical storms forecasted, eight of them reaching hurricane strength and three to four becoming major hurricanes. The predicted numbers for storm and hurricane making landfall in the US are near or slightly above the long-term norm with four hurricane landfalls. However, those predictions are tempered with high uncertainty.

It is important to consider that only a single hurricane making landfall in a high exposure area can lead to significant losses for the insurance industry and thus ongoing management of natural catastrophe risk is essential regardless of such predictions.



AccuWeather, 2018 Atlantic hurricane outlook: 4 US impacts predicted amid another active season. April 2, 2017

Bloomberg, Hurricane Harvey was second most expensive storm in US history. January 25, 2018

Colorado State University (CSU), Extended range forecast of Atlantic seasonal hurricane activity and landfall strike probability for 2018, April 5, 2018

Global Weather Oscillation (GWO), Dangerous 2018 Atlantic Hurricane Season Predicted – GWO, March 2018

MunichRe, The costliest natural catastrophes 2018, January 4, 2018

North Carolina State University (NSCU), NC State researchers predict active 2018 Hurricane Season for East Coast, April 16, 2018

Tropical Storm Risk (TSR), Extended range forecast for Atlantic hurricane activity in 2018. April 2018

The Weather Company (TWC), 2017 hurricane season forecast update calls for an above-average number of storms, April 20, 2018