High winds affecting various areas in Eastern Canada Monday will not necessarily result in a catastrophe event for property insurers, but it’s too early to tell for sure.
Early Environment Canada forecasts suggested the storm could potentially lead to the first catastrophe event during the pandemic shutdown, leading some to wonder how the industry would handle such claims during the era of social distancing.
“At the moment, we have not yet seen an indication that claims volumes would result in a Cat declaration,” Crawford Canada chief claims officer Greg Smith told Canadian Underwriter Tuesday. “However, circumstances can change as policyholders begin to assess damages and report claims today.”
Environment Canada reported wind gusts of 102 km/h in Montreal and as high as 124 km/h at Riviere-la-Madeleine, on the northern shore of the Gaspe Peninsula.
Firefighters in the Montreal area were called to houses where large trees fell and blocked streets, and carports had lifted off the ground, CTV reported.
In Ontario, wind speeds exceeded 60 km/h for a couple of hours Monday afternoon at the Environment Canada weather station at Port Colborne, southwest of Niagara Falls.
Further west, more than a dozen large ships took shelter in Long Point Bay (on Lake Erie about an hour southeast of London) as a precaution against gale force winds, The Simcoe Reformer newspaper reported.
A catastrophe generally refers to an event that costs the industry $25 million or more.
Canada’s costliest catastrophe in 2019, at $250 million, was the Hallowe’en storm that affected Eastern Canada, especially the Niagara and Montreal areas.
So what happens if the industry experiences a weather cat during a pandemic?
“The state of emergency creates some challenges investigating claims, but we have contingency plans in place for events like this and are prepared to respond if volumes increase rapidly,” Smith told Canadian Underwriter. More than 90% of Crawford Canada employees are working at home with secure access to the tools they need to do their jobs, said Smith.
“They are screening all new losses for on-site visits and leveraging our YouGoLook platform for remote site-visits where feasible.”
YouGoLook lets claimants send images of damaged property using a smart phone app.
It has been more than a month since the World Health Organization declared COVID-19 is a pandemic. Most provinces and territories have declared temporary states of emergency, ordering entire industries to close their workplaces, banning large gatherings, warning people to stay home unless necessary, and cautioning against coming within two metres of people who are not in the same household.
But sometimes adjusters have to visit sites and Crawford has processes in place.
“Before we attend the site, whether it is a home or business, we will ask some screening questions to find out whether there are some health or safety concerns,” Smith told Canadian Underwriter last month shortly after Ontario declared a state of emergency over COVID-19. This would include whether the occupants have symptoms such as cough, fever or shortness of breath.