Winter Storms Will Total $2.5 Billion By Year’s End
Winter storms from January through March racked up more than $2 billion worth of damage, according to the Insurance Information Institute (I.I.I.) and end-of-month projections for November place the final tally for the year at near $2.5 billion.
If these projections hold up — and it’s likely they will since $2.4 billion of it came in the first three months of the year — then 2014 will be the fourth costliest year on record for winter storm losses in the U.S.
“Severe winter weather is the third-largest cause of insured catastrophe losses, after hurricanes and tornadoes,” said Dr. Robert Hartwig, president of the I.I.I. and an economist. “Losses from snow, ice, freezing and related causes averaged $1.2 billion annually over the past twenty years.”
Hartwig added that winter storm claims, including the ones associated with ice damage and freezing, “accounted for 6.4 percent of all insured catastrophe losses between 1994 and 2013, placing it third behind hurricanes and tropical storms (41 percent) and tornadoes (36 percent) as the costliest natural disasters.”
In 2013, winter losses totaled $1.8 billion.
Of the hectic start to the year, Munich Re reports there were “11 winter storms and cold waves occurring in the January through March period, causing 84 fatalities and an estimated $2.4 billion in insured losses.”
The so-called “Polar Vortex” from January 5-8 caused around $1.7 billion in insured losses, I.I.I. adds.
Making matters worse, last month was the coldest November since 1976.
And cities like Buffalo are already experiencing a bitter taste of winter storms in spite of the fact that winter isn’t officially here yet.
With these factors at play, what should your clients know heading into the holiday season?
- That auto claims are more likely.
The I.I.I. explains: “According to data from Verisk’s Insurance Services Office, 42 states saw auto insurance claims rise in the first quarter of 2014, compared with a year earlier. Several upper Midwest states (Illinois, Minnesota, Indiana and Michigan) saw collision claims rise over 20 percent. Countrywide, claim frequency rose 8.5 percent from a year earlier.”
Emphasizing safe driving precautions for icy roads is a must. Motorists should drive slow in questionable conditions and limit travel in severe winter weather. Also, watch out for other drivers and try to give a wide berth so that another’s mistakes don’t result in a claim.
- That home damages are more prevalent this time of year.
Frozen pipes and collapsed roofs are two major causes for concern during this time of year, especially for insurance customers facing the challenges seen in Buffalo, where there was a particularly heavy snowfall (some estimates place it at seven feet). Throw in a quick warmup to melt this significant amount of winter precipitation, and the threat of flooding increases as well.
While there isn’t anything your clients can do to prevent Mother Nature’s icy blast, they should inspect rooftops after storms and quickly act on any areas of concern. They should also make sure their homeowners policy covers this type of flooding. If not, purchasing through the National Flood Insurance Program is a necessity. Last but not least, dormant pipes are at greater risk of freezing, so it’s important to keep heat and air flowing through them even if the homeowner is going to be away for the holidays.
- That ice can lead to slip-and-fall injuries both on the job and at home.
Watching those steps are essential when traversing the ice. While your customers might only be concerned with their home or car, remind them of the prevalence of slip-and-fall injuries. “Winter-related slip-and-fall claims at Midwestern workplaces doubled in 2013-2014 from the previous year,” I.I.I. reports. “Such accidents represent 29 percent of all workers compensation claims.”
The snow can be lovely to look at during the winter, especially when it comes with a White Christmas attached; but it also presents a new list of dangers of which your insurance leads & customers should be aware.