Damage Claims May Hit $3.4 Billion
Torrential rainstorms and tornadoes that ripped through the United States at the end of May, including one that destroyed the small town of Spencer, S.D., paved the way for the worst spring quarter for property damage claims, an insurance industry group said Monday.
The Property Claims Services unit of the Insurance Services Office said an estimated $3.4 billion in property damage claims are expected from catastrophic damage caused during the April-June period.
Combined with an estimated $1 billion in losses in the first quarter, the $4.4 billion claimed make this the worst first half since 1994, when the Northridge earthquake generated $15.6 billion worth of claims.
The worst catastrophe so far this year was the band of storms that struck 12 states from Minnesota to Vermont from May 30 to June 1, causing an estimated $650 million in property damage. In Spencer, six people were killed and 150 of the town’s 175 buildings were destroyed.
By comparison, the costliest storm on record was Hurricane Andrew in 1992, which caused nearly $18 billion in damage, when adjusted for inflation, the ISO said.
Overall, 26 catastrophes--defined by the ISO as generating $25 million or more of insured property losses--have struck the U.S. so far this year, the most since 1982. Sixteen of those catastrophes took place in the second quarter.
The worst previous second quarter was in 1992, when $3.37 billion in claims were filed.
The hardest-hit state so far this year is Minnesota, where nature’s devastation has led to an estimated $635 million in property claims. Tennessee ranks second, with $270 million in damage, followed by Iowa ($245 million), New York ($240 million) and Georgia ($225 million).
The claims estimate does not include the recent fires in Florida, where about 350 homes and businesses have been destroyed.