NEW YORK, May 12, 1999 — Insurers are expected to pay at least $1.485 billion in insured property losses — a record from a U.S. tornado-related catastrophe — according to preliminary estimates from Insurance Services Office, Inc's. (ISO) Property Claim Services (PCS) unit.
Oklahoma, with a record catastrophe loss of $955 million for insured property, topped the 18 states that were ravaged by the series of deadly tornadoes, strong wind, and hail that struck between May 3 and 7.
In Oklahoma, an F5 tornado with wind speeds exceeding 300 miles cut a destructive swath through Oklahoma City and surrounding towns, including Moore, Del City and Midwest City, where entire neighborhoods were leveled. The previous Oklahoma record for catastrophe losses was $150 million in June 1992 from tornadoes, wind, and hail.
Total claims for 18 states is estimated to exceed 370,000. PCS will resurvey insurers to review the claim count and loss estimates in 60 days.
Oklahoma City and its suburbs sustained insured property losses of an estimated $775 million, primarily from direct tornado damage. Insurers have received an estimated 146,000 property-loss claims from Oklahoma policyholders, the vast majority from homeowners.
Property losses in Kansas totaled $100 million. The worst-affected area in the state was around Haysville in Sedgwick County. Thunderstorm, winds, and large hail caused extensive damage to numerous structures and vehicles in the Wichita area, as well. More than 37,000 property-damage claims were filed with insurers in Kansas.
The next three states, in descending order of insured loss from tornadoes, wind, hail, and flooding, are: Texas, $75 million; Tennessee, $50 million; and Georgia, $40 million.
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 and 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, and business-interruption losses. The estimates exclude loss-adjustment expenses.