Insured losses this winter set to be among top 5 costliest since 1980

Insured losses from winter storms this year have reached more than $1.5 billion so far, the Insurance Information Institute in the United States said Monday.

That estimate, from Property Claims Services at Verisk Analytics, is based on events between Jan. 1 and Feb. 21, with more than 175,000 claims paid to policyholders. The figures also includes only two of four major winter storms to date, the institute said in a release.

The losses came from property damage to homes and buildings from roof collapses, downed tree limbs and power lines, and frozen pipes bursting, along with auto accidents. Business interruption and supply  chain losses have also been experienced during the first two months of the year.

Last year, winter storms caused $2 billion in insured losses, up from only $38 million in 2012, the institute noted, citing reports from Munich Re.

From 1993 to 2012, winter storms caused roughly $28 billion in insured catastrophe losses (in 2012 dollars), or $1.4 billion per year on average, according to PCS, the I.I.I. also said.

Overall, this winter (which officially ends March 19), will likely be among the top five costliest for insured losses since 1980, according to the institute.

However, losses this year are still within what has been planned for by insurers, especially as the industry began the year on solid financial footing, the institute noted.

“Severe winter weather, including snow, sleet, freezing rain, extreme cold and ice damage, accounted for 7.1 percent of all insured catastrophe losses between 1993 and 2012, placing it third behind hurricanes and tropical storms (40 percent) and tornadoes (36 percent) as the costliest natural disasters,” Dr. Robert Hartwig, president of the I.I.I. and an economist noted in the organization’s press release.

“While most winter storm losses occur in northern and mountainous regions of the United States, this spate of severe cold has also affected millions of home and business owners in the south, many of whom were unprepared for such extreme conditions,” he noted.