Alabama Hurricane Insurance: Fact File

AUGUST 2016

  • Three of the 10 costliest hurricanes in U.S. history have impacted Alabama: Hurricane Katrina and Rita in 2005 and Hurricane Ivan in 2004. (See chart below.)
  • Hurricane Ivan resulted in $1.6 billion in total flood insurance losses paid for by the National Flood Insurance Program (NFIP) (in all states). Hurricane Katrina resulted in $16 billion in total flood insurance losses paid by the NFIP (in all states).
  • There were 55,264 flood insurance policies in Alabama in 2015. Standard homeowners policies typically do not cover flood damage. Flood insurance is covered by the National Flood Insurance Program.
  • The number of people living in coastal areas in Alabama increased from 2010 to 2015 by 18,873 people, or 2.5 percent, to 784,657 people, according to the U.S. Census Bureau.
  • The total value of insured coastal property in Alabama was $118.2 billion in 2013, accounting for 13 percent of the state’s total insurance property exposure, according to AIR Worldwide.
  • The Alabama Insurance Underwriting Association (AIUA) was voluntarily formed in the early 1970s by the insurance industry in cooperation with the Alabama Department of Insurance as a market of last resort to provide property and windstorm and hail insurance in the coastal areas of Alabama.
  • The AIUA’s exposure base has expanded rapidly. The exposure to loss—insured value of all properties—was $5.5 billion in fiscal year 2015 up from about $3.3 billion for fiscal year 2010. The AIUA had 31,622 policies in force in fiscal year 2015 compared with 31,996 policies as of 2014.
  • AIUA policies have a hurricane deductible that applies only in the event of a hurricane. The standard deductible for all other perils is $500.

 

Top 10 Writers Of Commercial Insurance In Alabama By Direct Premiums Written, 2015 (1)

 

Rank Group/company Direct premiums written ($000) Market share
1 Travelers Companies Inc. $209,369 6.5%
2 American International Group (AIG) 177,069 5.5
3 Chubb Ltd. (2) 144,049 4.5
4 Zurich Insurance Group (3) 135,338 4.2
5 Liberty Mutual 130,485 4.1
6 Auto-Owners Insurance Co. 123,089 3.8
7 CNA Financial Corp. 110,315 3.4
8 Nationwide Mutual Group 103,873 3.2
9 Cincinnati Financial Corp. 99,211 3.1
10 State Farm Mutual Automobile Insurance 74,151 2.3

(1) Before reinsurance transactions.
(2) Chubb Ltd. data reflects the 2015 merger with Ace Ltd.
(3) Data for Farmers Insurance Group of Companies and Zurich Financial Group (which owns Farmers' management company) are reported separately by S&P Global Market Intelligence.

Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.

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Top 10 Writers Of Homeowners Insurance In Alabama By Direct Premiums Written, 2015 (1)

Rank Group/company Direct premiums written ($000) Market share
1 State Farm Mutual Automobile Insurance $499,992 30.2%
2 Alfa Mutual Group 220,284 13.3
3 Allstate Corp. 183,759 11.1
4 USAA Insurance Group 111,600 6.7
5 Farmers Insurance Group of Companies (2) 97,780 5.9
6 Travelers Companies Inc. 78,181 4.7
7 Liberty Mutual 58,391 3.5
8 Nationwide Mutual Group 48,938 3.0
9 COUNTRY Financial 40,995 2.5
10 Auto-Owners Insurance Co. 34,468 2.1

(1) Before reinsurance transactions.
(2) Data for Farmers Insurance Group of Companies and Zurich Financial Group (which owns Farmers' management company) are reported separately by S&P Global Market Intelligence.

Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.

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Top 10 Writers Of Private Passenger Auto Insurance In Alabama By Direct Premiums Written, 2015 (1)

Rank Group/company Direct premiums written ($000) Market share
1 State Farm Mutual Automobile Insurance $708,054 25.4%
2 Alfa Mutual Group 403,708 14.5
3 Allstate Corp. 309,808 11.1
4 Berkshire Hathaway Inc. 264,329 9.5
5 Progressive Corp. 187,514 6.7
6 USAA Insurance Group 179,082 6.4
7 Nationwide Mutual Group 96,320 3.5
8 Liberty Mutual 73,701 2.6
9 Farmers Insurance Group of Companies (2) 73,514 2.6
10 Travelers Companies Inc. 63,096 2.3

(1) Before reinsurance transactions.
(2) Data for Farmers Insurance Group of Companies and Zurich Financial Group (which owns Farmers' management company) are reported separately by S&P Global Market Intelligence.

Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.

View Archived Tables

 

 

Top 10 Costliest Hurricanes In The United States (1)

($ millions)

        Estimated insured loss (2)
Rank Date Location Hurricane Dollars when
occurred
In 2015
dollars (3)
1 Aug. 25-30, 2005 AL, FL, GA, LA, MS, TN Hurricane Katrina $41,100 $49,047
2 Aug. 24-26, 1992 FL, LA Hurricane Andrew 15,500 24,111
3 Oct. 28-31, 2012 CT, DC, DE, MA, MD, ME, NC, NH,
NJ, NY, OH, PA, RI, VA, VT, WV
Hurricane Sandy 18,750 19,563
4 Sep. 12-14, 2008 AR, IL, IN, KY, LA, MO, OH, PA, TX Hurricane Ike 12,500 13,826
5 Oct. 24, 2005 FL Hurricane Wilma 10,300 12,292
6 Aug. 13-14, 2004 FL, NC, SC Hurricane Charley 7,475 9,207
7 Sep. 15-21, 2004 AL, DE, FL, GA, LA, MD, MS, NC,
NJ, NY, OH, PA, TN, VA, WV
Hurricane Ivan 7,110 8,758
8 Sep. 17-22, 1989 GA, NC, PR, SC, UV, VA Hurricane Hugo 4,195 7,152
9 Sep. 20-26, 2005 AL, AR, FL, LA, MS, TN, TX Hurricane Rita 5,627 6,715
10 Sep. 3-9, 2004 FL, GA, NC, NY, SC Hurricane Frances 4,595 5,660

(1) Includes hurricanes occurring through 2015.
(2) Property coverage only. Excludes flood damage covered by the federally administered National Flood Insurance Program.
(3) Adjusted for inflation through 2015 by ISO using the GDP implicit price deflator.

Source: Property Claim Services (PCS®), a Verisk Analytics® business.

 

 

Estimated Value Of Insured Coastal Properties Vulnerable To Hurricanes By State, 2012 (1)

($ billions)

Rank State Commercial Residential Total
coastal
Total
exposure (2)
Coastal as a
percent of total
1 New York $2,105.6 $817.5 $2,923.1 $4,724.2 62%
2 Florida 1,359.9 1,502.4 2862.3 3640.1 79
3 Texas 653.8 521.5 1,175.3 4,580.7 26
4 Massachusetts 456.0 393.6 849.6 1,561.4 54
5 New Jersey 374.6 339.3 713.9 2,129.9 34
6 Connecticut 271.7 296.1 567.8 879.1 65
7 Louisiana 153.5 140.0 293.5 823.0 36
8 South Carolina 129.9 109.4 239.3 843.6 28
9 Virginia 95.2 87.1 182.3 1,761.7 10
10 Maine 73.3 91.3 164.6 285.5 58
11 North Carolina 65.8 97.7 163.5 1,795.1 9
12 Alabama 61.6 56.6 118.2 917.8 13
13 Georgia 57.4 49.3 106.7 1,932.2 6
14 Delaware 31.8 50.1 81.9 208.9 39
15 New Hampshire 28.5 35.5 64.0 278.7 23
16 Mississippi 29.6 31.0 60.6 468.5 13
17 Rhode Island 22.6 35.7 58.3 207.5 28
18 Maryland 8.7 8.6 17.3 1,293.4 1
  Total, states shown $5,979.5 $4,662.7 $10,642.2 $28,331.4 38%
  Total, United States 5,979.5 4,662.7 $10,642.2 $64,624.3 16%

(1) Includes residential and commercial Gulf and East Coast properties, as of December 31, 2012. Ranked by value of total insured coastal property.
(2) Total exposure is an estimate of the actual total value of all property in the state that is insured or can be insured, including the full replacement value of structures and their contents, additional living expenses and the time value of business interruption coverage.

Source: AIR Worldwide.

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Other Resources

Alabama Insurance Underwriting Association

FEMA Regional Flood Fact Sheet: http://www.floodsmart.gov/floodsmart/pdfs/Region_4_Hurricane_fact_sheet_FINAL_for_web.pdf

I.I.I. Facts & Stats: Flood Insurance

I.I.I. Facts & Stats: Hurricanes

I.I.I. Issues Updates: Catastrophes

I.I.I. Issues Updates: Hurricane and Windstorm Deductibles