Wednesday, May 22, 2013
Itâ€™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 weÂ have seen repeatedly during hurricane, tornadoÂ and wildfire seasons, itÂ 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 Missouriâ€™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.â€
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.