A year after a series of “bomb cyclones” struck the United States as reported by my partner Seth Jackson last year, the “bomb cyclone” is back in the news as part of large winter storm that wreaked havoc across the United States earlier this week. As a result of the most recent “bomb cyclone,” it was reported that nearly 650,000 people were without power and more than 80 million people were under high wind advisories.
What exactly is a “bomb cyclone”? In technical terms it is one of the names assigned to explosive cyclogenesis. Explosive cyclogenesis occurs when a low-pressure system’s pressure drops 24 millibars in 24 hours or less. A low-pressure system is a system where the pressure in the atmosphere at sea level is lower than the surrounding areas. Winds then converge in this area and begin to rotate in the same direction as the earth. The sudden drop in pressure over a short period of time obviously creates severe winds, hence the “bomb cyclone.” A bomb cyclone can develop inside any storm and is not a storm itself, but a condition within a storm. However, they typically occur in the winter. The origin of this term likely dates back to an academic article published in 1980 titled “Synoptic-Dynamic Climatology of the ‘Bomb.’” It is obvious that “bomb cyclone” is a much catchier phrase. The increasing prevalence of the term “bomb cyclone” is most likely due to the increasing hype surrounding weather forecasts. It is safe to assume that more people tune into a forecast that is discussing a “bomb cyclone” than they would one discussing a regular winter storm.
Hype aside, the winds from these “bomb cyclones” can be devastating as the recent storm highlighted. From an insurance standpoint, these storms will likely generate the same kind of damage as might be seen from hurricane-force winds. However, since these storms may impact areas that do not regularly experience tropical storms or hurricanes, you may see increased damage as building codes and practices may not be as robust.
You may also see claims related to service interruption arising from the wide-spread power outages. Service interruption claims can be complicated to adjust as this type of loss is typically excluded in the policy, but may be added as a coverage extension or by endorsement. This can lead to disputes in trying to adjust the loss as the limits for this coverage may be significantly less than the limits otherwise available under the policy. In Schultz Furriers, Inc. v. Travelers Cas. Ins. Co. of Am., 2017 WL 1731005, at *4 (N.J. Super. Ct. App. Div. May 3, 2017), an unpublished decision out of New Jersey, this dilemma gave rise to litigation. The insured’s property lost power to its business as the result of transformers that were knocked down during Superstorm Sandy. Travelers paid the insured $2,500 in limits for a Power Pac Endorsement that provided time element coverage for loss of utility service from damage to utility services not on the insured property. Not surprisingly, the insured sought coverage under the main form of the policy because it provided far greater limits. However, the court agreed with Travelers that service interruption was specifically excluded in the main form and the Power Pac Endorsement was the only coverage available for off-premises service interruption.
These extensions of coverage may also be limited to service interruption that directly impacts the insured property. In Pentair, Inc. v. Am. Guarantee & Liab. Ins. Co., 400 F.3d 613, 617 (8th Cir. 2005), the insured’s suppliers were forced to shut down two factories when an earthquake disabled electrical substations servicing the factories. While the policy extended coverage to service interruption regardless of whether it caused property damage, it only covered losses from damage to off-premises power stations supplying power to the “described premises.” Id. Since the suppliers’ factories were not “described premises,” the coverage did not extend to the service interruption at those factories. Id.
It is unclear whether the changing climate will lead to increasing “bomb cyclones.” John Gyakum, one of the authors of the original 1980 article, believes that the ongoing climate change will certainly lead to increasing severity in these storms, if not increasing numbers. Either way, we can expect to continue to see “bomb cyclone” streaming across our TV screens each winter as stations clamor for more viewers.
Posted by Jonathan MacBride