NEW YORK, July 7, 1999 – The U.S. property/casualty insurance industry will pay an estimated $3.25 billion to homeowners and businesses for insured property losses from 13 catastrophic events in the second quarter, according to Insurance Services Office, Inc.'s (ISO) Property Claim Services (PCS) unit.
That compares with the $4.5 billion in catastrophe claims from 16 events in the second quarter of last year.
Payments to policyholders for this year's first half will total almost $5.1 billion on approximately 2.1 million claims for 18 catastrophic events. That's nearly $460 million less than the $5.5 billion in losses in the year-ago period. For all of 1998, the industry sustained $10.1 billion in catastrophe losses.
The bulk of the industry's second-quarter catastrophe losses this year stemmed from deadly tornadoes and tropical storms that barreled through Oklahoma and 17 other states in early May, causing $1.5 billion in insured property damage. Oklahoma sustained the biggest loss - $955 million - from that event. Total claims for 18 states exceeded 370,000, PCS estimates.
The most expensive second-quarter catastrophe ever was in 1998, when a spring storm in Minnesota caused an estimated $1.3 billion in insured property damage. The $5.1 billion total in first-half 1999 catastrophe losses is the third-highest for the period since 1994, when losses totaled $15.6 billion.
Following is the ranking of the top 10 states for second-quarter catastrophe losses since 1990:
ISO's PCS unit defines a catastrophe as an event that causes $25 million or more in insured property losses and affects a significant number of property/casualty policyholders and insurers.
The PCS estimate represents anticipated insured loss on an industry-wide basis arising from the catastrophe, reflecting the total net insurance payment for personal and commercial property lines of insurance covering fixed property, personal property, vehicles, boats, related property items, business interruption, and additional living expenses. The estimates exclude loss-adjustment expenses.