More than 200,000 insurance claims have now been reported in the state of Iowa due to damage caused by August’s severe Derecho storm event in the Midwest United States.
With overall insurance and reinsurance market losses from the derecho event expected to reach as high as $5 billion, the insurance regulator in Iowa has now reported over $1.6 billion of insurance claims already paid.
It’s testament to the swift response of the insurance and reinsurance market to large catastrophe events, with the derecho one of the most costly events of recent quarters.
Some attritional impacts are expected to certain ILS market positions as well, with the derecho also perhaps accentuating aggregate deductible erosion for certain reinsurance contracts as well.
Of the 200,000 claims filed for the derecho, the Iowa Insurance Division said that almost 160,000 claims totaling more than $1.6 billion have already been paid, while insurance companies are holding more than a billion in reserves to be used for the rest of the claims.
So that suggests more than a $2.6 billion industry loss for Iowa alone.
“The Iowa Insurance Division has been monitoring the insurance industry’s response to the Derecho and the industry’s role in Iowans’ recovery efforts,” Iowa Insurance Commissioner Doug Ommen explained
“As policyholders pursue claims under their insurance contracts, we encourage property owners to continue to work diligently with their insurance company and agent as they obtain the necessary repairs. Adjustments can take time, but we have seen other challenges, including early cold, snow and some shortages of materials and contractors. Delays in replacement of grain bins have garnered attention. Further weather concerns with winter inching closer places concern on whether to wait until spring to make repairs to the roof, siding, etc.
“If a consumer believes the insurance company is providing less than what is promised in their insurance contract, they can file a complaint with us at the Iowa Insurance Division. We will review the contract and claim details.”
Homeowners multi-peril policies have taken the brunt of the claims, at more than 103,000, followed by farm multi-peril, private auto and commercial multi-peril.
As we explained recently, some carriers are already claiming reinsurance support to help in paying claims from the derecho event.