ISO: Insurers’ $920 Million in CAT Losses is Lowest for Q2 in a Decade

U.S. property/casualty insurers are expected to pay homeowners and businesses an estimated $920 million for second-quarter insured property losses from four catastrophes in 25 states — the lowest tally among second quarters in the past 10 years, according to preliminary estimates by ISO’s Property Claim Services (PCS) unit.

This compares with insured losses of $2.3 billion in second-quarter 2004 and $5.1 billion in second-quarter 2003. The property/casualty industry’s worst second quarter for catastrophe losses was $6.2 billion in 2001.

For the first half of this year, insured property losses from catastrophes stand at $3.05 billion from 12 events in 37 states.

PCS estimates the second quarter’s four catastrophes generated nearly 311,400 claims, nearly half of which are from homeowners.

Severe weather, including high winds, hail, tornadoes and flooding, was responsible for all the insured damage in the quarter.

The costliest event this quarter was a severe thunderstorm in early May that affected 14 states, causing $305 million in insured property damage.

At $315 million, Texas topped the list of the five most severely affected states, followed by Nebraska at $105 million, Kansas at $85 million, Oklahoma at $65 million and Colorado at $45 million.

Following is a summary of second-quarter losses and frequency of events since 1996:

Year Loss ($) Frequency

1996 $1.7 billion 12
1997 $980 million 9
1998 $4.5 billion 16
1999 $3.5 billion 13
2000 $1.5 billion 10
2001 $6.2 billion 9
2002 $2.8 billion 10
2003 $5.1 billion 4
2004 $2.3 billion 6
2005 $920 million 4.