Two snowstorms that hit the United States this month will cause insured damages in excess of $2 billion, according to a catastrophe risk modeling firm.
Oakland, Calif.-based EQECAT said the loss estimate is based on a preliminary assessment of the overall scale of the two storms relative to major prior events in the last two decades.
Meanwhile, Gary Kerney, assistant vice president of Property Claim Services--a unit of the Insurance Services Office Inc. in Jersey City, N.J.--said he expects PCS to have official loss estimates for the storms sometime this week.
He said PCS is classifying both storms as catastrophes, meaning each storm should have insured losses in excess of $25 million.
EQECAT said it believes the majority of the losses will be focused in the corridor from northern Virginia to the New York metropolitan area, with the most common sources of losses resulting from roof damage, pipe breakage and ice dams in eaves causing water to leak into buildings.
AIR Worldwide issued a statement on Feb. 10, in the midst of the second of the two February storms, noting that business interruption is likely to be another major driver of insured losses.
Regarding roof collapse claims, Tim Doggett, a principal scientist at AIR, said the combined storms could cause havoc for roofs, particularly light metal, long span, low slope and flat roofs.
"When multiple storms come in quick succession, with little time for the accumulated snow pack to melt, as has been the case this month, the situation is exacerbated," he said. "Design snow load for Washington, D.C., is about 30 pounds per square foot. With the drifting that accompanies high winds, many roofs will be at risk of collapse."
Zurich Insurance noted that snow has been present in 49 of 50 states this month (with Hawaii the lone exception), and some states not used to facing this risk could be exposed to losses.
"Businesses in places like Alabama, Louisiana and Texas may not have foreseen significant amounts of snow this winter, and are finding themselves caught off-guard when suddenly presented with the threat of roof collapse," said Rich Gallagher, property line of business director at Zurich Services Corp. in Schaumberg, Ill.
"The storms of the past few weeks have shown that preparedness for winter weather accumulations shouldn't be unique to regions where snowfall is expected. Businesses should plan for the unexpected as well," added Mr. Gallagher.
According to the Insurance Information Institute, winter storms are the third-largest cause of catastrophe losses, behind hurricanes and tornadoes, and result in about $1 billion in insured losses each year.
The New York-based Institute said winter storms resulted in more than $7 billion in insured losses from 1999-2008.
