Torrential rains, which caused floods in South India in November and early-December, has led to economic losses to the tune of $3 billion (about Rs 20,000 crore), a report said on Thursday.
According to reinsurance broker Aon Benfield’s monthly Global Catastrophe Recap report, economic developments in Asia are taking place in flood plains and marsh lands with scant attention to drainage, thus increasing run-off and flooding.
An enhanced North East monsoon impacted by the current El Nino brought weeks of torrential rainfall to southern India and Sri Lanka for much of November into early December, the report said.
Portions of Tamil Nadu and Andhra Pradesh in India and Sri Lanka were heavily impacted by floods. There were severe impact to agricultural interests and infrastructure as rivers swelled into both rural and urban areas. Chennai metropolitan region was particularly damaged by the event, it added.
“Total economic losses in India were estimated to reach as high as Rs 200 billion ($3 billion). India’s General Insurance Corporation claims possibly reaching up to Rs 20 billion ($300 million),” it revealed.
Aon Benfield’s report evaluates the impact of the natural disaster events that occurred worldwide.
The firm’s Head of Impact Forecasting Asia Pacific Adityam Krovvidi says that scant attention to drainage while pursuing economic developments in Asia is also a major cause of flooding.
“The 100-year rainfall event in Chennai exposed the inherent weakness of the one-dimensional nature of this economic pursuit and highlights the need for serious introspection, implementation of mitigation measures and the redesign of urban landscapes,” he added.
Risk assessment can play a major role in awareness and insurance in mitigating the financial hardships. The large gap between the economic and insured loss from the Chennai flood event further emphasises the need for greater insurance penetration in large industrialized cities in Asia, he said.
“This will become even more important as Asian megacities continue to grow and the risk of major urban flood events increases,” Krovvidi said.