NICB: Number of Hail Claims Fluctuates But Severity Through the Roof
Though recent analysis of hail claims revealed a significant decline within the past couple of years, data compiled by Verisk A-PLUS property database indicates hail-related claims costs soared between 2008-2013.
The National Insurance Crime Bureau released the most recent three-year analysis of insurance claims associated with hail storms in the United States. In 2013, there were 720,473 hail damage claims filed. That number increased in 2014 to 824,325 then dropped in 2015 to 572,182 claims – an overall decrease of 21 percent from 2013 to 2015.
The nation experienced 10 major hail-producing storms during this period according to the National Oceanic and Atmospheric Administration (NOAA), each of which caused over $1 billion in property damage. While experts debate why these storms occur, no one argues with their effects—extensive property damage and many times, loss of life.
According to data from Verisk’s A-PLUS property database, U.S. insurers paid almost nine million claims for hail losses, totaling more than $54 billion from 2000 through 2013. Nearly 70 percent of the hail damage claims occurred within a six year period. In recent years, the costs of these hail-related claims has dramatically increased. The average claim severity during the period 2008-2013 was 65 percent higher than it was from 2000 through 2007. The Verisk report outlines that increased roofing costs are the reason hail claims severity continues to rise and that demand surge significantly affects roofing labor costs.
Weather-related property damage can be as minimal as a few broken shingles to total destruction of buildings. This report focuses on insurance claims resulting only from hail damage.
A total of 2,116,980 hail loss claims were processed from January 1, 2013 through December 31, 2015. During this period, the top five states generating hail damage claims were Texas (394,572), Colorado (182,591), Nebraska (148,346), Kansas (127,963) and Illinois (120,513). The top five months, on average, when the most hail loss claims were reported during this period were May (165,087), April (149,040), June (129,085), March (61,072) and July (55,650).
Source: NICB