Catastrophes in 1998, 2005, 2009 and 2010 cost insurers $3.8 billion: PCS-Canada

PCS-Canada has reviewed the sum of all catastrophes in Canada from 1998, 2005, 2009 and 2010, and has determined that these events collectively cost the industry $3.8 billion, involving 850,000 insured properties.

“These may be surprising numbers to the Canadian insurance industry,” according to a “Summary of Catastrophe Activity in 2010 and Earlier Years,’ which appeared in the MSA/Baron Outlook Report Q3-2010. “However it points out the value…of the information that comes from a structured process to identify catastrophe events and estimate the losses that these events cause.”

PCS-Canada identified four catastrophes in 2010, including tornadoes in Ontario, storms and flooding in Saskatchewan, a hail storm in Alberta and Hurricane Igor hitting Newfoundland and Labrador.

“In summary, the four catastrophes caused an estimated insured property loss of nearly $800 million, based on current estimates,” according to the summary. “These same events also produced over 85,000 claims to the insurance industry.”

The summary noted Hurricane Igor was “a surprising event, especially since the U.S. escaped a direct hit by a hurricane despite the very active hurricane season and the large number of tropical cyclones in the Atlantic Basin.”

PCS-Canada said reviewing past catastrophes was a difficult assignment, because many insurers did not have recoverable records and mergers and acquisitions made it difficult to capture some data.

But a review of the 1998 Ice Storm shows it resulted in $1.5 billion of insured property damage to more than 660,000 properties.

The Toronto weather storm in 2005 caused about $600 million in insured losses, affecting more than 24,000 properties.

And nine individual events in 2009 caused about $1 billion in insured damage to more than 80,000 insured properties, including vehicles.