June 15, 2020 by Greg Meckbach
The thunderstorm that hit Calgary this past Saturday evening could be more expensive to the industry than the 2014 Airdrie, Alta., hail storm that cost P&C insurers more than $500 million, an industry watcher suggests.
Hail the size of tennis balls hit some Calgary neighborhoods June 13, the Canadian Press reported. Residents posted photos and videos of icy rivers flowing along their streets and vinyl siding smashed off the sides of homes.
As of Monday, it’s too early to tell what the industry-wide losses would be, said Glenn McGillivray, managing director of the Institute for Catastrophic Loss Reduction. But he does not rule out the possibility of last Saturday’s deluge making the Top 5 list of Canadian weather disasters when measured by industry-wide losses.
“I am personally wondering if we are going to approach $1 billion on this one,” McGillivray said in an interview Monday with Canadian Underwriter.
ICLR has not done its own estimate. McGillivray’s conjecture is based on viewing photos and videos of the damage, alongside the fact that Calgary is much bigger than Airdrie.
Calgary’s census metropolitan area, as reported by Statistics Canada, had a population in 2019 of 1.5 million, placing it fourth in Canada behind Toronto, Montreal and Vancouver.
Airdrie’s population is about 68,000, McGillivray noted.
“This time around, Airdrie got whacked again, but Calgary got whacked and a whole bunch of other places got whacked,” McGillivray told Canadian Underwriter of the June 13, 2020 storm. “I am personally wondering whether we are looking at the largest hail loss in Canadian insurance history. If not, that could be one of the largest convective storms or thunderstorms in insurance industry history in Canada.”
The 2014 Airdrie hail storm cost the industry $583 million, adjusted for inflation, A.M. Best Company Inc. reported at its annual Canadian briefing in September 2019. As of 2019, that made Airdrie Canada’s eighth most expensive natural disaster since 1991.
The June 13, 2020 Calgary storm could exceed the Airdrie losses because of the number of homes with destroyed roofs and shredded vinyl siding, McGillivray said Monday. There would also be broken windows, commercial properties with damaged rooftop heating, ventilation and air conditioning units, as well as a number of auto claims with broken windows and damaged body panels.
“It starts getting really costly,” said McGillivray, adding it’s conceivable it could cost the industry about as much as the July 8, 2013 storm system that hit the greater Toronto area. That was Canada’s fourth most expensive natural disaster since 1991, A.M. Best reported this past September. Topping the list was the 2016 Fort McMurray wildfire at $4 billion, followed by the 1998 ice storm at $2.3 billion and the 2013 southern Alberta floods at $1.7 billion. A.M. Best adjusted those numbers for inflation.
Ahead of the 2014 Airdrie disaster, ranking fifth, sixth and seventh, were the:
Feature image via iStock.com/Mitchell Wessels