Insurance companies doing business in Texas have counted their losses after reviewing the state’s catastrophic weather events last year.
According to the Insurance Services Office, a catastrophic event is a weather or man-made event that causes at least $25 million or more in insured property losses and affects a significant number of people. Texas had seven catastrophic events in 2012, and it cost insurance companies some $2.3 billion in losses.
Dallas/Fort Worth bared the brunt of Mother Nature’s force. The metroplex suffered hailstorms and tornadoes on both April 3 and June 13 that accounted for nearly 75 percent of all insured losses statewide in 2012. Both these storms rank among the top 10 costliest of Texas’ storms.
Hailstorms are the most damaging weather events in Texas. While hurricanes and tornados are the most dangerous events, insured hail losses exceed those caused by both hurricanes and tornados combined. It’s become such a problem that the Texas Department of Insurance has declared a “War on Hail” campaign, where people are encouraged to update their homes and businesses with hail-resistant materials. Most insurance companies offer discounts for such updates.
Texas’ insurance losses are by no means out of the ordinary. The $2.3 billion in catastrophic losses are only about 20 percent of all weather related losses in Texas, and account for 10 percent of the national total of insured losses.
The country’s total catastrophic losses for 2012 are estimated to be around $27 billion, with $11 billion related to Hurricane Sandy.