Thunderstorms


Natural catastrophe events in the United States accounted for three of the five most costly insured catastrophe losses in the first half of 2014, according to just-released Swiss Re sigma estimates.

In mid-May, a spate of severe storms and hail hit many parts of the U.S.  over a five-day period, generating insured losses of $2.6 billion. Harsh spring weather also triggered thunderstorms and tornadoes, some of which caused insured claims of $1.1 billion.

The Polar Vortex in the U.S. in January also led to a long period of heavy snowfall and very cold temperatures in the east and southern states such as Mississippi and Georgia, resulting in combined insured losses of $1.7 billion.

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These three events contributed $5.4 billion of the $19 billion in natural catastrophe-related insured losses covered by the global insurance industry in the first half of 2014, according to sigma estimates.

The $19 billion was 10 percent down from the $21 billion covered by insurers for natural catastrophe events in the first half of 2013. It was also below the average first-half year loss of the previous 10 years ($23 billion). Man-made disasters added $2 billion in insured losses in the first half of 2014, sigma reports.

The $21 billion in insured losses from disaster events in the first half of 2014 was 16 percent lower than the $25 billion generated in the first half of 2013, and lower than the average first-half year loss of the previous 10 years ($27 billion).

Total economic losses from natural catastrophes and man-made disasters reached $44 billion in the first half of 2014, according to sigma estimates.

More than 4,700 lives were lost as a result of natural catastrophes and man-made disasters in the first half of 2014.

Multiple outbreaks of severe weather led to a costly month for insurers in the United States in May, as thunderstorm events continued to dominate the catastrophe record.

According to the latest Global Catastrophe Recap report by Aon Benfield’s Impact Forecasting, no fewer than four stretches of severe weather affected the U.S. during the month of May.

Aggregate insured losses exceeded $2.2 billion and overall economic losses were at least $3.5 billion, with large hail and damaging winds the primary driver of the thunderstorm-related costs, Impact Forecasting reports.

The costliest stretch occurred during a five-day period (May 18-23) which saw damage incurred in parts of the Midwest, Plains, Rockies, Mid-Atlantic and the Northeast, including the major metropolitan areas of Chicago, IL and Denver, CO.

According to Impact Forecasting’s report, baseball-sized hail and straight-line winds gusting in excess of 70 mph (110 kph) were recorded that severely affected residential, commercial and auto interests. Total economic losses were estimated at $2.5 billion, with insurers reporting losses minimally at $1.5 billion.

Meanwhile, the combination of excessive heat, extreme drought conditions, low relative humidity and gusty winds led to dozens of wildfires across parts of the Texas Panhandle and Southern California, leaving two dead.

Overall fire costs/damages from the two states approached $100 million, according to Impact Forecasting.

In Texas the most significant fire was in Hutchinson Country, where at least 225 homes and 143 unoccupied structures were damaged or destroyed.

In California, at least 14 fires were ignited in the greater San Diego metropolitan region, including the Poinsettia Fire that destroyed eight homes, an 18-unit condominium complex, and two commercial buildings.

The report adds that through the end of May, tornado activity in the U.S. remained in the bottom 25th percentile of all years dating to the early 1950s.

Check out I.I.I. facts and statistics on thunderstorms.

If you haven’t read it already, the April edition of the Global Catastrophe Recap Report by Aon Benfield’s Impact Forecasting puts some numbers around the thunderstorm events that devastated parts of the United States last month.

According to the report, severe weather and flash flooding that caused extensive damage across more than 20 states in April will likely be the first billion-dollar economic loss event of 2014 attributed to convective thunderstorms.

At least 39 people were killed and 250 injured amid nearly 70 confirmed tornado touch-downs, which occurred across more than 20 states in the Plains, Mississippi Valley, Southeast, Midwest, and Mid-Atlantic.

Economic losses are set to exceed $1 billion, with insured losses minimally in the hundreds of millions of dollars, Impact Forecasting reports.

Another U.S. severe weather outbreak in April led to major damage in parts of the Plains, Midwest and the Mississippi Valley. The most significant damage was due to hail, as hailstones the size of softballs struck the Denton, Texas metro region.

Total economic losses were estimated at $950 million, with insured losses in excess of $650 million, according to the report.

In a press release Adama Podlaha, head of Impact Forecasting, says:

The recent outbreaks of tornadoes, large hail and damaging straight-line winds in the United States have emphasized the importance of historical data analysis for insurers and reinsurers when trying to forecast future losses.”

If you’re wondering how many convective thunderstorm events made the list of significant natural catastrophes in 2013, take a look at this slide from a presentation made by I.I.I. president Dr. Robert Hartwig at the National Tornado Summit in February.

It shows that thunderstorms accounted for six of the nine significant natural catastrophe events with $1 billion economic loss and/or 50 fatalities in 2013.

A major severe weather outbreak continues across parts of the southern and eastern U.S. today, as insurers rush to multiple states hit Sunday and Monday by a total of more than 90 tornadoes, some of which caused fatalities.

Here are the NOAA Storm Prediction Center’s (SPC) storm reports for Sunday, April 27 and Monday, April 28:

A fact that often goes unreported is that tornadoes are among the largest causes of insured losses in any given year, accounting for 36 percent of all insured losses since 1983, according to the I.I.I.

Increasingly dense suburban development across the U.S. is putting more people and property in areas at risk of tornadoes than ever before.

Eighty percent of U.S. natural disaster related insurance claims payouts in 2013 were attributable to tornadoes and severe thunderstorms—$10.27 billion out of total estimate of $12.79 billion, according to remarks made in February 2014 by I.I.I. president Robert Hartwig, at the National Tornado Summit in Oklahoma City, Oklahoma.

A report from the National Insurance Crime Bureau (NICB) has revealed that insurance claims resulting from hailstorm damage in the United States increased by a whopping 84 percent from 2010 to 2012.

In 2010, there were 467,602 hail damage claims filed, but by 2012 that number had jumped to 861,597.

All told, over two million hail damage claims were processed from January 1, 2010 to December 31, 2012, the NICB said.

Perhaps not surprisingly the top five states generating hail damage claims during this period were Texas (320,823); Missouri (138,857); Kansas (126,490); Colorado (118,118) and Oklahoma (114,168).

“Personal Property Homeowners” (PPHO) was the policy type most affected by hail loss claims, with 1.3 million, or 64 percent of the total number of hail loss claims between 2010 and 2012.

On average, PPHO policies were represented more than twice as often as the next most popular policy type, personal automobile.

NICB points out that most of the hail loss claims occurred in the spring and summer months, between March and July, likely due to increased numbers of thunderstorms during this period.

So far, large hail reports posted to NOAA’s National Weather Service Storm Prediction Center site in 2013 appear to show that hailstorm activity is down from 2012. See below:

 

While the NICB report focuses just on hail claims, it’s worth adding that severe thunderstorms in the U.S., including tornadoes, resulted in $14.9 billion in insured losses in 2012, more than $25 billion in insured losses in 2011, and $9.5 billion in insured losses in 2010, according to Munich Re.

In the first-half of 2013, insured losses from thunderstorm events exceeded $6 billion, Munich Re said.

Reports of a “small tornado” in New Jersey hit very close to home Monday morning as I was driving to an appointment when torrential rain and thunderstorms bore down.

The National Weather Service (NWS) has confirmed that the EF-0 tornado touched down in Union County, New Jersey, amid a band of thunderstorms that brought heavy rain and flooding to parts of the state yesterday.

The tornado touched down in Berkeley Heights and for eight minutes cut a path nearly 50 yards wide and 4.8 miles long northeast through New Providence and Summit.

Winds reached an estimated 85 mph and extensive tree damage was observed along the tornado path, the NWS said.

The NJ Star Ledger reports that New Jersey has experienced at least one tornado in each of the last five years, according to records from the National Oceanic and Atmospheric Administration. All of them were listed as EF-0, the lowest designation.

Here’s a visual of the tornado’s path, courtesy of NJ.com and the NWS:

An EF-1 tornado is also confirmed to have touched down in Connecticut yesterday, causing property damage.

Check out I.I.I. facts and statistics on tornadoes and thunderstorms.

It’s a little ironic that in the weeks preceding the devastating May 20, 2013 Moore, Oklahoma tornado, there were numerous reports of how 2013 tornado activity was at a record low.

Unfortunately, these headlines may give the mistaken impression that the United States is in a period of lower risk for tornadoes, and/or that the costs from such events are declining.

Yet as we have seen repeatedly during hurricane, tornado and wildfire seasons, it only takes one storm, or event, to remind us of the dangers and ongoing risks.

Dr. Robert Hartwig, president and chief economist of the I.I.I., notes that the U.S. is actually in the midst of the most expensive period in recorded history for thunderstorm events, which include damage from tornadoes.

The I.I.I. reports that severe thunderstorms, including tornado events, cost $14.9 billion in insured losses in 2012, but that number stood at $25 billion a year earlier because of the two costliest tornado events in U.S. history:

– The $7.5 billion in insured damages (in 2012 dollars) arising out of the late April 2011 twisters that struck multiple states, most notably Alabama, which accounted for nearly $3 billion of the total damages, and;

– The $7 billion in insured damages (in 2012 dollars) that resulted from the May 2011 tornado outbreak, which also impacted numerous states. Joplin, Missouri, was the hardest hit community, incurring $2.2 billion of the $7 billion in damages, making that tornado the single largest insurance event in Missouri’s history.

Dr. Hartwig adds:

Over the past five years, insurers paid some $75 billion to victims of these events. As the events in Moore tragically demonstrate, this trend toward more violent and destructive weather patterns shows no signs of abating.”

A post on the Wall Street Journal Money Beat blog suggests that property/casualty insurers will face at least a few billion dollars of insured losses from the May 20, 2013 Moore, Oklahoma tornado, according to rough calculations by Wall Street analysts.

Check out the New York Times for panoramic images taken Tuesday comparing the same locations before and after the storm struck Moore.

Severe thunderstorms again took their toll this weekend as one fan was killed and nine injured as a result of lightning strikes following a NASCAR race at Pocono raceway on Sunday.

The Associated Press reports that multiple lightning strikes occurred behind the racetrack’s grandstands and outside one of the gates as fans were leaving after warnings to take cover from the lightning and rain as the race was postponed.

Earlier, on Saturday, an estimated 60,000 fans and 3,000 staff, artists and vendors were evacuated from the annual Lollapalooza music festival in Chicago in 38 minutes, ahead of a severe thunderstorm warning for the area.

Over at Wunderblog, Dr. Jeff Masters notes that NOAA’s Storm Prediction Center (SPC) logged over 150 reports of wind damage from the storm, with five of the thunderstorms containing winds in excess of hurricane force (74 mph).

The Chicago Tribune reports that many of the measures leading up to the evacuation had been outlined in a severe weather plan jointly developed by the city and Lollapalooza promoter C3 Presents. The festival resumed three hours later.

The Insurance Information Institute (I.I.I.) notes that in 2011 there were 26 lightning fatalities, three fewer than the 2010 total of 29 deaths and 11 fewer than the 10-year average of 37 fatalities, according to data from the National Oceanic and Atmospheric Administration (NOAA).

The I.I.I. offers tips and resources on lightning safety here.

Extreme weather event losses in the United States dominated natural catastrophe loss statistics in the first half of 2012, according to a review by Munich Re and the Insurance Information Institute (I.I.I.).

In the 2012 half-year natural catastrophe review, Munich Re noted that some 85 percent of worldwide insured losses and 61 percent of overall losses were incurred in America, predominantly in the U.S. – compared with an annual average of 65 percent and 40 percent respectively since 1980.

Severe thunderstorm, tornado events in the U.S. accounted for the five costliest natural catastrophes for the insurance industry in the first six months of the year.

The most severe single event was a squall line that crossed several states between 2 and 4 March. Some 170 tornadoes were counted in and around the Ohio and Tennessee River alone, and a small number of communities were almost completely destroyed. Insured losses totaled $2.3 billion.

In a press release Peter Höppe, Head of Munich Re’s Geo Risks Research unit, noted:

Overall, most of the severe thunderstorm-related outbreaks with tornadoes affect a limited area, and may cause serious damage locally but are not comparable in scale to events like severe hurricanes. However, due to the number of events, the aggregate annual loss amounts can attain the level of a major hurricane landfall, as seen last year.”

The good news for insurers is that natural catastrophe losses in the first half of 2012 were relatively moderate. Overall global losses to the end of June were $26 billion, of which some $12 billion were insured.

In a recent post over at the Property/Casualty Insurance blog, Gary Kerney commented that for decades, hurricanes got the headlines and caused more insured losses than tornadoes and thunderstorms, but last year, all that changed.

More facts and statistics on tornadoes and thunderstorms from the I.I.I.

Every year lightning strikes the ground 30 million times and injures about a thousand people in the United States, according to the Lightning Protection Institute (LPI).

As next week is Lightning Safety Awareness Week, here’s a recap by the numbers of this underrated weather hazard and cause of property damage, courtesy of the Insurance Information Institute (I.I.I.).

Note to readers: numbers are based on an analysis of homeowners insurance data by the I.I.I. and State Farm:

186,000: The number of lightning claims paid out by homeowners insurers in 2011. Losses ranged from damage to expensive electronic equipment to structural fires that destroyed entire homes.

$5,112: The average cost of a lighting claim in 2011, up 5.5 percent from 2010.

93%: The increase in the average cost per claim from 2004-2011, even as the actual number of paid claims fell by over 33 percent over the seven-year period. This decline may be due to increased use of lightning protection systems.

Loretta Worters, vice president of the I.I.I., sums up the findings:

The number of paid claims is down, but the average cost per claim continues to rise, in part because of the huge increase in the number and value of consumer electronics in homes. Plasma and high-definition television sets, home entertainment centers, multiple computer households, smart phones, gaming systems and other expensive devices—which can all be destroyed by power surges—continue to have a significant impact on claims losses.”

With this in mind, it’s good to know that damage caused by lightning, such as fire, is covered by standard homeowners and business insurance policies. Some home and business insurance policies provide coverage for power surges that are a direct result of lightning striking a home or business, according to the I.I.I.

There is also coverage for lightning damage under the comprehensive portion of an auto insurance policy.

Check out more I.I.I. facts and statistics on lightning here.