Reflecting the severity of recent severe thunderstorms and convective weather events in the United States, modeller CoreLogic has estimated that the stretch of activity between just June 11th and 15th could result in insurance market losses of up to $10 billion.
CoreLogic pegs the insured loss from hail and straight line winds over this period as between $7 billion and $10 billion, opting for an $8.7 billion fix.
This is a considerably higher estimate than the one other we have reported on for this period of severe thunderstorm activity and losses in the US.
Catastrophe modeller Karen Clark & Company (KCC) estimated that a spate of Severe Convective Storm (SCS) activity that struck the Central and Southern United States between June 10th and 19th would drive an insurance and reinsurance market loss of around $5.5 billion.
So, CoreLogic’s estimate spans fewer days of storm activity, but points to a higher bill for insurers, so even even more likely knock-on effects for the reinsurance market.
As we reported last week, Steve Bowen, Chief Science Officer at reinsurance broker Gallagher Re has said the total cost to the insurance industry from the severe convective storm (SCS) peril has likely surpassed $25 billion year-to-date.
CoreLogic said that severe thunderstorm activity from June 11th to 15th brought strong straight-line winds, record-sized hail, and tornadoes, causing substantial damage to property across the United States, with winds of over 100 mph reported and very large hail of greater than four inches in diameter seen.
CoreLogic said it, “estimates that the straight-line winds and hail from June 11-15 caused between $7 and $10 billion in insured losses. This loss estimate encompasses hail damage and straight-wind damage and was enabled by CoreLogic’s weather monitoring technology, which allows for comprehensive tracking of all losses from severe convective storm events.”
Adding that, “This loss estimate includes damage to residential, commercial, and industrial property, as well as automobiles. The estimate also excludes damage to infrastructure such as roads, utilities, and governmental facilities. Hail alone is estimated to make up 95% of losses from this event, making it one of the biggest hail losses in history.”
CoreLogic’s analysis suggests that, straight-line winds above 60 mph may have affected more than 2.9 million homes, with Florida, Missouri, and Georgia especially affected.
Meanwhile, the large hail greater than one inch, which it believes drove the majority of insured losses, could have affected more than 1 million homes, CoreLogic said, especially in Texas, Arkansas, and Oklahoma.
As we’d also recently reported, a prime example of the effects of severe and convective weather events and severe thunderstorms through the second-quarter, has been Allstate’s disclosures of particularly high catastrophe losses, with now almost $1.8 billion reported for April and May, the first two months of the aggregate risk period for its Sanders catastrophe bonds.
It now increasingly looks as if there’s a strong chance June could be another costly, perhaps more so, month for major US insurers such as Allstate.