JERSEY CITY, N.J., July 2, 2001 — U.S. property/casualty insurers will pay homeowners and businesses $1.2 billion for insured property damage wreaked by Tropical Storm Allison during the first two weeks in June, according to preliminary estimates by Insurance Services Office, Inc.'s (ISO) Property Claim Services (PCS) unit.
Insurers also are expected to pay another $1.7 billion to policyholders for insured-property losses when thunderstorms, tornadoes, flooding, hail and wind whipped through 16 states from Texas to Pennsylvania during the week of April 6-12. Homeowners and businesses in the 16 states filed 280,300 claims with insurers for damage to insured vehicles, dwellings and commercial buildings.
Tropical Storm Allison wrought havoc in six states from Texas to New Jersey, dumping heavy rain and causing extensive wind and flooding damage. Insurers have received a total of 219,500 claims for damage to vehicles, dwellings and commercial property from policyholders in Texas, Pennsylvania, Louisiana, New Jersey, Florida and Mississippi.
Texas sustained $1 billion of the $1.2 billion in insured-property damage from Tropical Storm Allison, primarily from the flooding of vehicles, dwellings and commercial property. Up to 32 inches of rain fell across the state. The Houston area suffered the heaviest losses.
Pennsylvania was the second-worst affected state, with $120 million in insured losses. Most of the damage to vehicles, residential and commercial property was concentrated in the greater Philadelphia area. Losses in the remaining states were: Louisiana, $65 million; New Jersey, $10 million; and Florida and Mississippi, $5 million each.
The brunt of the April 6-12 catastrophe damage was borne by Missouri policyholders who filed more than 170,000 claims with insurers. Missouri's insured losses were a staggering $1.2 billion. St. Louis and vicinity were hit the hardest when golfball-size hailstones pounded thousands of vehicles and shredded roof coverings of residential and commercial buildings.
Four states followed Missouri in insured-property losses: Nebraska, $150 million; Texas, $60 million; and Kansas and Illinois, $40 million each.
ISO's PCS unit defines a catastrophe as an event within a particular territory that causes $25 million or more in insured-property losses and affects a significant number of property and casualty policyholders and insurers.
The ISO loss analysis does not include flood losses which are covered by the federal National Flood Insurance Program.
PCS estimates represent anticipated insured loss on an industrywide basis arising from catastrophes, 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.