AIR Worldwide Estimates Insured Losses Could Exceed $2.2 Billion
BOSTON, May 14, 2003 — AIR Worldwide Corporation, a leading catastrophe modeling company,estimates that losses from the recent outbreak of severe weather in the central United States could exceed the $2.2 billion loss caused by a severe weather system April 6–12, 2001, making it the largest insured loss for a severe thunderstorm system in history. AIR's estimate covers the period from May 2 through May 11 and includes more than 18 states. The 72-hour period with the highest industry loss was May 4 to May 6, representing more than 50 percent of the total insured loss.
"This event is one for the record books in meteorological terms and very possibly in financial terms," said Uday Virkud, senior vice president at AIR. NOAA's Storm Prediction Center received more than 400 reports of tornadoes before the pattern broke on May 11. There were approximately 2,500 reports of straight-line winds and hail. This highly unusual weather system was caused by a stationary weather pattern that started during the last week of April. It resulted in a jet-stream pattern that persisted in the same position for nearly two weeks, resulting in a nearly continuous threat of severe weather during that time. "The high financial losses from the system can be attributed to the duration of the weather system and the sheer number of individual tornadoes, hailstorms and straight-line windstorms," Mr. Virkud concluded.
AIR derives its insured loss estimates by collecting data for each individual event within the larger system, including tornadoes, hailstorms and straight-line windstorms. Once the data is collected and analyzed, it is run through AIR's severe thunderstorm model. The model includes highly detailed property exposure information to capture the localized nature of severe thunderstorms. The engineering component of AIR's model determines property damage by calculating the impact of wind and hail on property. AIR dispatched a team of engineers to survey the damage.
About AIR Worldwide Corporation
AIR Worldwide Corporation is a leading catastrophe and weather risk modeling company. Through its web-based and computer software solutions (ClimateCastSM, CLASIC/2TM,CATRADER®, CATMAP®/2, AIRProfiler®), AIR services the insurance, reinsurance and capital markets. AIR's models simulate losses from both man-made and natural catastrophes in more than 35 countries. AIR is headquartered in Boston and has additional offices in North America, Europe and Asia. For more information, please visit the AIR website at www.air-worldwide.com.
ISO is a leading source of information, products and services related to property and liability risk. For a broad spectrum of commercial and personal lines of insurance, ISO provides analytical and decision-support products; consulting; data processing; and technical, statistical and actuarial services. ISO's products help customers with sales and prospecting, underwriting, rating and quoting, customer management, policy administration, product development, claims administration and fraud detection. ISO's AIR Worldwide subsidiary provides customers with the most advanced technologies to assess and manage natural and man-made extreme-event risk. Through its ISO Claims Services, Inc. (iiX unit) and Intellicorp subsidiaries, ISO provides motor vehicle reports and criminal-records information and through its AscendantOne unit delivers policy-management and rating solutions. In the United States and around the world, ISO serves insurers, reinsurers, agents, brokers, self-insureds, risk managers, insurance regulators and other government agencies.