Ernesto a potential hurricane threat to Bermuda. Ampil a potential typhoon threat to Tokyo

Two tropical cyclones on opposite sides of the world will be watched closely by interests in the reinsurance and insurance-linked securities (ILS) market over the coming days, with tropical storm Ernesto seen as a potential hurricane threat to Bermuda and tropical storm Ampil in the Pacific seen as a potential typhoon threat to Tokyo, Japan.

Tropical storm Ernesto is tracking towards the Lesser Antilles and has Puerto Rico and the Dominican Republic also set to feel its effects as a strong tropical storm or low category hurricane, according to the latest forecasts.

But, beyond that, all forecast models curve a hurricane Ernesto northwards and in the general vicinity of Bermuda after a few days, with some models showing the hurricane coming very close to the island as a Category 2 or 3 strength storm.

There is a lot of uncertainty over how close hurricane Ernesto could be to Bermuda when it nears and the forecasts are a fair way out still. But, we’d urge out friends and partners on the island to keep watching as the Ernesto forecasts develop, as there could be a need to prepare for potential impacts over the next couple of days.

You can see tropical storm Ernesto’s location, forecast path and intensity in the graphic below from Tomer Burg:

Given Ernesto is currently not forecast to become a major hurricane before nearing Puerto Rico and is expected to then curve north, so missing the continental US, it is not likely to be viewed as a significant loss threat by the insurance and reinsurance industry.

However, should Ernesto intensify into a hurricane faster than anticipated, then it does have the potential to intensify further before nearing Puerto Rico, which could make it more of a concern for the industry, as well as for the parametric structures and reinsurance capital deployed to protect that territory.

Bermuda is well-prepared and experienced in dealing with hurricane impacts, but we would urge our friends and contacts there to keep one eye on Ernesto as it develops over the next few days, as this could become a major storm and may pass very close to Bermuda.

You can track this and every Atlantic hurricane season development using the tracking map and information on our dedicated page.

Moving across the globe to the Pacific, tropical storm Ampil is developing to the south of Japan, and is also forecast to turn north and intensify.

The expectation is that typhoon Ampil is named and heads for the Izu and then Tokyo or Chiba region of Japan, but with some uncertainty in the forecast path and whether typhoon Ampil could curve before it reaches the island of Honshu, or whether it makes a glancing blow on this region of Japan and turns away, or a direct impact.

Forecasts suggest typhoon Ampil could be nearing sustained winds of 115 mph as it bears down on the Tokyo region of Japan.

As such, should it intensify and head straight for the highly-populated region of Japan, around Tokyo and the surrounding area from Yokohama to Chiba, this could threaten a relatively significant insurance and reinsurance market loss, for the Japanese typhoon peril.

Ampil could present a relatively significant threat to the industry, should it fail to curve, or curve later than forecast models anticipate at this time.

You can see the latest forecast path and intensity for what will become typhoon Ampil in the graphic below from the JTWC:

With typhoon Ampil it is all going to be about the steering currents as the storm nears Japan and whether it is pushed north east to curve away from a landfall, or whether major metropolitan areas in the Tokyo region feel typhoon strength winds.

There is much to watch for the reinsurance and insurance-linked securities (ILS) community over the coming days, on both sides of the globe as tropical storm seasons continue apace.