Insurance and reinsurance broker Aon has offered its view on the recent winter storm activity in the United States, saying that an expected “hurricane-level” of claims from the winter storm “will translate to payouts well into the billions of dollars.”
Aon’s Impact Forecasting unit has not provided a loss estimate and so still the only official estimate we have is the one from Karen Clark & Company, of around $18 billion for the impacts of the entire winter storm event across numerous states and days.
AIR Worldwide ventured that the winter storm could result in insurance and reinsurance market losses that rise “well in excess” of $10 billion.
Hundreds of thousands of insurance claims are likely from the winter storm event, part of which was named winter storm Uri.
Aon’s Impact Forecasting unit explained, “It remains too early to have a specific view of the economic and/or insured loss as there will be a prolonged period of assessments.
“The emerging post-assessment guidance continues to suggest a “hurricane-level” of filed insurance claims in Texas alone that will translate to payouts well into the billions of dollars (USD).”
The company expanded on this, explaining some of the expected financial impacts.
“The assessment period across Texas and in many other U.S. states remains ongoing. With temperatures warming in recent days, this has resulted additional pipes bursting as the thawing process begins. Areas where heavy snow and ice has been prevalent in recent weeks has also led to more reports of roof collapses. As cited previously, preliminary survey reports from insurers and local government officials do continue to indicate that the period from February 12-20 is expected to result in a significant financial cost.
“Given the uniqueness of the size and swath of damage that this stretch wintry weather caused – of which there is little historical precedent for this peril – there remains an unusually high level of uncertainty around properly estimating the potential loss. As more insurance claims are filed, this will help allow a much clearer picture emerge as to how many billions of dollars (USD) the total will rise. There is near unanimous agreement that this will become the most expensive period of winter storm losses for the insurance industry on record. It is likely to far surpass the USD3.7 billion incurred during the March 1993 “Storm of the Century”,” Impact Forecasting said.