Insured losses from winter storms this year are now an estimated $1.5 billion, according to the Insurance Information Institute, compared to $2 billion for 2013. The estimate covers two of the four winter storms this year, which transpired between January 1 and February 2014, and more than 175,000 claims paid to policyholders, according to PCS, a division of Verisk Analytics.
Insured losses from winter storms include roof collapses, downed tree limbs and power lines, burst pipes from freezing and auto accidents, Insurance Information Institute (I.I.I.) said. Businesses also suffered from interruption and business closings, as well as supply chain losses due to travel and transportation delays.
“While most winter storm losses occur in northern and mountainous regions of the United States, this spate of severe cold has also affected millions of home and business owners in the south, many of whom were unprepared for such extreme conditions,” said Robert Hartwig, economist and president of the I.I.I.
Severe winter weather, including snow, sleet, freezing rain, extreme cold and ice damage, accounted for 7.1 percent of all insured catastrophe losses between 1993 and 2012. Following hurricanes and tropical storms (40 percent) and tornadoes (36 percent), sever winter weather is the third costliest natural disaster, Hartwig said, adding that losses remain within the magnitude insurers planned for and that the industry began the new year good financial condition and with record levels of claims paying capital.
From 1993 to 2012, winter storms caused $28 billion in insured catastrophe losses, or an annual average of $1.4 billion per year, according to Property Claim Services (PCS), a division of Verisk Analytics.
“Three of the four most costly years ever for insured losses from winter storms and damage occurred in the 1990s, led by the Storm of the Century’ in 1993,” Hartwig said. That storm affected 24 states and Canada, causing more than $3.2 billion in insured losses and 270 fatalities. Central Alabama and Georgia received more than six inches of snow and Birmingham, Alabama, received up to 12 inches with isolated reports of 16 inches, according to the National Oceanic and Atmospheric Administration. “Even the Florida Panhandle reported up to 4 inches of snow with hurricane-force wind gusts,” I.I.I. said.
