JERSEY CITY, N.J., Nov. 2, 2004 — U.S. property/casualty insurers suffered a record $21.3 billion in insured property loss claims from eight catastrophes in the third quarter — the industry's worst third quarter ever — according to preliminary estimates by ISO's Property Claim Services (PCS) unit.
This compares with insured losses of $3.7 billion in third-quarter 2003 and $715 million in third-quarter 2002. The industry's previous worst third-quarter property losses were $19.15 billion in 2001, which included $18.8 billion from the Sept. 11 terrorist attack. (The Sept. 11 estimate represented only insured property losses and related coverages, such as business-interruption insurance, but excluded liability insurance, workers compensation, aviation, life and health insurance.)
Catastrophe losses for the first nine months of 2004 now stand at $24.7 billion — the second worst nine-month period for catastrophe losses since 2001 when insurers paid $26.1 billion. The industry's insured losses for the first nine months last year were $10.2 billion.Of the eight events that affected 21 states and Puerto Rico in the quarter, four were hurricanes — Charley, Frances, Ivan and Jeanne — which together accounted for an estimated $20.5 billion of the third quarter's losses. The rest were from Tropical Storm Gaston and three wind and thunderstorm events.
Florida was hit the hardest and suffered $17.5 billion in insured losses on nearly 1.7 million claims, followed by Alabama ($1.2 billion), Georgia ($630 million), Pennsylvania ($445 million) and North Carolina ($255 million).
The following is a five-year comparison of third-quarter property losses from catastrophes and event frequency:
|Year||Insured Losses ($)||Frequency|
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.
PCS estimates represent anticipated insured losses on an industrywide basis arising from catastrophes, reflecting the total insurance payment for personal and commercial property items, business interruption and additional living expenses. The estimates exclude loss adjustment expenses.
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