NOAA database removal may affect insurers’ loss tracking: A.M. Best

Ratings agency A.M. Best said Tuesday the National Oceanic and Atmospheric Administration’s removal of its billion-dollar weather disaster database could impede insurers’ ability to track losses due to secondary perils.

If further data sources are lost, parametric triggers within catastrophe bonds, which depend on NOAA measurements, may need to be redesigned, Best said.

NOAA announced May 8 its annual report of billion-dollar weather and climate disasters would no longer be updated due to “evolving priorities, statutory mandates, and staffing changes.”

The database, created in 1980, was archived and discontinued after 2024, according to NOAA.

Secondary perils have become a major cause of loss for U.S. property/casualty insurers with property catastrophe-exposed lines of business, due predominantly to weather patterns, inflation and exposure growth, Best said.

“Having a common and agreed-upon data source would help insurers trend these losses in their modeling and use the data for pricing, reinsurance and risk management,” Sridhar Manyem, senior director, industry research and analytics at Best, said in a statement.