Severe weather results in major payouts from insurance firms

Posted on: Tuesday, July 24, 2012

Thanks to severe weather events in regions across the United States, insurance firms will be handing out almost $2 billion to those it covers.

The recently released Global Catastrophe Recap report from Aon Benefield, a reinsurance intermediary, revealed that one of the most damaging events to take place so far this year happened when hail storms occurred in New Mexico and Texas. The study found that as a result of the natural disaster, 100,000 claims had been filed, costing insurers $1 billion or more.

Severe hail storms in Colorado and Wyoming also caused quite a bit of damage as well. The report estimates that total damage from the weather event resulted in approximately $700 million in losses.

Residents in Colorado Springs were victimized by the Waldo Canyon Fire, which took the lives of two people and burned 347 homes in all. Those who helped conduct the study, published by Impact Forecasting, a subsidiary of Aon, said that the harm caused by the fires was unprecedented for the state.

"The Colorado wildfires proved to be the two most damaging fires in state history, and also two of the costliest," said Steve Jakubowski, president of Impact Forecasting. "Impact Forecasting is the only firm to have developed a brushfire catastrophe model for the western states in the U.S., which allows us to provide detailed feedback to our clients following events such as these."

A number of companies from around the United States have been handing out funds as well. Executives from Travelers Insurance said that during the April-June period, the sector had lost $10 billion or more. In an interview with Reuters, the head of the firm, which charges different insurance rates depending on circumstances, said that payouts by his company had already exceeded last year's total.

Posted In: Insurance News, Property & Casualty Insurance

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