Tropical Cyclone

Tropical Cyclone Enawo off the coast of Madagascar. Photo: Antti Lipponen/Flickr

Recognizing the demand for parametric insurance products that address different climate perils across Africa, African Risk Capacity has been developing a product to provide rapid financing and early response to tropical cyclones. Led by ARC Ltd and working with Kinetic Analysis Corp (KAC), a parametric Tropical Cyclone model was developed for the South West Indian Ocean (SWIO) region. KfW has provided funding to ARC to support the model development and implementation as well as other in-country activities.

The Tropical Cyclone model will cover the hazards of wind, storm surge and wave damage while rainfall in cyclones will be covered under a separate flood product. ARC will use the 1983 – present dataset on storm tracks and intensity from the Joint Typhoon Warning Centre. The Tropical Cyclone modelling will be available via Africa RiskView.

KAC developed the Caribbean Catastrophe Risk Insurance Facility (CCRIF)’s hurricane and earthquake parametric models and uses modelling technology which is strongly supported by the global reinsurance and capital markets. Reinsurers will therefore already be familiar with the technical engine used in ARC’s Tropical Cyclone model. KAC also has a Real-time Forecast System which provides the early warning component necessary to meet ARC’s requirements.

ARC Agency has been engaging Madagascar, Comoros, and Mauritius around the product. ARC has also attended meetings of the Indian Ocean Commission’s ISLANDS project as it is looking to build on the regional platform already established by this initiative.

Tropical Cyclone Model in Action

In 2017, African Risk Capacity’s Tropical Cylone model had its first run monitoring the impact of tropical cyclones with Tropical Cyclone Enawo. The cyclone formed in the Indian Ocean and grew in severity to a Category 4-equivalent tropical cylcone in the matter of days. Its path was headed straight towards Madagascar.

African Risk Capacity began monitoring the track and impact of Enawo when the tropical cyclone made landfall on Madagascar on 7 March 2017. Using publicly available geo-information, African Risk Capacity monitored and published data and maps on the actual and forecasted cyclone track, the wind speeds, and storm surges. With this information, the African Risk Capacity Tropical Cyclone model was able to predict the numbers of people affected by the cyclone in each monitored location in Madagascar.

As an early warning and monitoring tool, the African Risk Capacity Tropical Cyclone model was able to disseminate consolidated information about the real-time impact of Enawo on Madagascar’s population. As the insurance product rolls out, the Tropical Cyclone model will underpin the African Risk Capacity’s mechanism for delivering rapid financing and disaster response to affected populations.