For our latest Artemis Live video interview we spoke with two senior Verisk Analytics execs with years of experience on the claims-side of the market, Mike Fulton, President of Xactware and Tom Johansmeyer, Head of PCS, about the recent winter storm and Texas freeze loss event.
For this Artemis Live video interview we wanted to take a deep-dive into into the recent severe winter weather and deep freeze event that affected a significant proportion of the United States in February, hitting Texas particularly hard.
Early estimates suggested the potential for the insurance and reinsurance market, including insurance-linked securities (ILS) funds, to face losses of $15bn to $20bn.
Over the last couple of weeks estimates have been coming down slightly, as greater clarity on the losses emerged, particularly with some reporting from the major nationwide insurance carriers most exposed in Texas.
To help me dive deeper into the insurance claims environment related to this event, we invited two senior Verisk Analytics execs with years of experience on the claims-side of the market, Mike Fulton, President of Xactware and Tom Johansmeyer, Head of PCS to this interview.
The pair explained why the winter storm and freezing weather does not seem to be driving an insurance and reinsurance industry loss as high as early predictions had suggested.
But Fulton of Xactware also explained the scale of the claims deluge his firm’s systems saw coming in, with huge numbers of claims seen flowing from Texas and the surrounding area.
Fulton said that a typical February might see around 400,000 claims in Xactware’s systems from across the US, but in 2021 the company saw nearly a million claims assignments logged.
“More than half of those (claims) being from freezing weather and burst pipes,” Fulton explained. “Roughly 30% of those 1 million claims, were due to what we believe to be freeze claims in Texas alone.
“So the impact when comparing to a normal year, for the personal lines market, was really significant.”
We also discussed business interruption (BI) and Johansmeyer of PCS said that the BI component of this winter storm loss hasn’t manifested to the degree some feared, although some BI claims are anticipated.
We will continue to bring you these interviews with leaders of the ILS and reinsurance industry on an ad-hoc basis, as and when our time and that of our contacts allow.
The full video interview is embedded below and can also be viewed in full, along with previous Artemis Live video interviews, over on our YouTube channel.
You can also listen in audio to our interviews by subscribing to the Artemis Live podcast here.
All of our Artemis Live video interviews have a focus on reinsurance, ILS and the efficiency of risk transfer and can be accessed directly from our YouTube Channel.
You can also listen in audio to these interviews by subscribing to the Artemis Live podcast here.
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