U.S. property/casualty insurers are expected to pay homeowners and businesses $6.5 billion for 2007 property losses from 23 catastrophes — the eighth lowest cost in a decade and the seventh lowest frequency for the same period, according to preliminary analysis by Insurance Service Office’s Property Claim Services Unit.
PCS estimates that insurers paid 1.18 million claims for damage in 41 states resulting from 2007’s 23 catastrophes. More than 721,000 personal lines claims accounted for $4.4 billion, while 144,000 commercial lines claims cost an estimated $1.3 billion, and 315,000 vehicle claims cost insurers an estimated $800 million.
The 23 catastrophes consisted of 17 severe weather events (wind, hail, tornadoes and flooding), five winter storms, and one wildland fire. Among the 41 states experiencing insured losses from catastrophes, following are the states with the largest losses:
California | $1.23 billion |
Minnesota | $747 million |
Texas | $677 million |
Georgia | $320 million |
Illinois | $272 million |
Oklahoma | $270 million |
Kansas | $262 million |
Missouri | $223 million |
New York | $202 million |
Colorado | $200 million |
Alabama | $200 million |
The costliest events to insurers in 2007 were due to severe weather that resulted in $1.35 billion of insured damage from Texas to Maine and the Witch Fire in San Diego County, Calif., which caused an estimated $1.1 billion in losses.
For the second year in a row, the United States dodged a devastating hurricane, says Gary Kerney, assistant vice president, PCS. With the exception of Humberto, which made landfall in southeast Texas and southwest Louisiana in September, no other hurricane made landfall on U.S. territory in 2007.
Fourth Quarter
Fourth-quarter 2007 PCS estimates that insurers paid $1.7 billion of insured property loss resulting from four catastrophes between October and December 2007 — the fourth costliest fourth quarter in the last decade.
The most costliest fourth quarter in the last decade occurred in 2005 when insurers paid $10.8 billion in insured losses from five catastrophes.
The four catastrophes in 4Q 2007 caused insured damage in nine states and a total of 159,000 claims. Following are the states with the largest insured losses in the fourth quarter:
California | $1.2 billion |
Oklahoma | $188 million |
Washington | $95 million |
Oregon | $70 million |
Missouri | $57.5 million |
ISO’s PCS unit defines a catastrophe as an event that causes $25 million or more in insured property losses.
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