Filed Under:Agent Broker, E&S/Specialty Business

Insurers Face ‘A Ton of Work’ After Texas Tornadoes (Video)

Homeowners in Forney, Texas sift through the wreckage left by a tornado April 3. (AP Photo/Tony Gutierrez)
Homeowners in Forney, Texas sift through the wreckage left by a tornado April 3. (AP Photo/Tony Gutierrez)

NU Online News Service, April 4, 8:20 a.m. EDT

The day after an estimated 18 tornadoes tore through the Dallas-Fort Worth area, throwing tractor-trailers like sticks into the air and peeling roofs from homes, residents and business owners are picking up the pieces.

Mark Hanna, spokesman for the Insurance Council of Texas (ICT), this morning says the insurance industry “has a ton of work ahead of it.”

“It will take a while to assess how bad yesterday was,” he adds. “This is a big insurance event. You’re talking about more than 12 tornadoes in a heavily-populated area of about 7 million people.”

SLIDESHOW: Texas Twisters Rip Through Dallas-Fort Worth Homes

 

The Red Cross estimates 650 homes were damaged in the Dallas-Fort Worth area on Tuesday. Preliminary reports indicate significant tornado damage to more than 300 homes in Lancaster. There are no reported deaths from the storm system.

Large hail—some the size of tennis balls—pounded vehicles and shattered windows.

State Farm reports about 960 homeowners' claims and 3,473 auto claims as of this morning. The hardest-hit areas are Dallas and Tarrant Counties, with damage spread across numerous counties in East Texas, spokeswoman Patti Kelly says. Spokesman Gary Stephenson adds that 86 homeowners claims are for destroyed homes, and 550 auto claims are for vehicles that cannot be driven. 

The tornadoes hit mid-afternoon, while many people were at work. Today, insurers can expect an excess of claims as home and business owners sift through the wreckage and get a grasp of losses.

"[Claims] numbers will increase by a significant level in the days ahead," Stephenson adds on behalf of State Farm.

As of early this afternoon, USAA says it has received more than 2600 claims so far from the storms and will open two claims locations in the Dallas-Fort Worth metro area by noon today. One is in Lewisville and the other in Arlington.  Most of the damage the insurer has seen is auto damage due to hail, says spokeswoman Rebecca Hirsch.

Businesses were also heavily affected. Yesterday, CNN affiliate WFAA broadcast video of tractor-trailers being picked up and tossed by the storm. After the storm, footage from news helicopters showed piles of mangled trailers and trucks.

The Dallas-Fort Worth airport was shut down. More than 400 flights were canceled. Planes were pummeled by hail.

Reports say that despite the widespread damage there were some injuries, but no deaths so far. 

“No one escaped the wrath of yesterday,” Hanna says. "Damage is scattered over many, many miles."

As insured losses from this storm system are being tallied, consider that the ICT on the morning of April 3 released an insured loss estimate of tens of millions of dollars for a March 29 windstorm and hail event in McAllen, a city on the southern tip of Texas with a population of about 130,000.

"While estimates are still being formulated, we know that there was a great deal of property damage," said Christopher Hackett, director of personal lines policy for the Property Casualty Insurers Association of America (PCI). "Insurance adjusters are in the field now, working to help victims of this storm put their lives back together. There are a number of things that those affected can do to help expedite the recovery process."

The cities of Kennedale, Arlington, Lancaster, southeast Dallas, Joshua, Forney, Desoto, Mesquite, Royce City and Greenville were struck by twisters yesterday, reports ICT.

Damage to structures and contents caused by wind are covered by standard homeowners and business insurance policies. Additionally, many homeowners’ policies provide living expenses for things like temporary residence in a hotel.

Business interruption claims can cover income that would have been earned had the storm not occurred. It may also cover expenses to operate from a temporary location, says the Insurance Information Institute.

Comprehensive coverage is needed on a vehicle for insurance to pay for damages from severe thunderstorms. 

According to the National Oceanic Atmospheric Administration (NOAA), there have been 379 tornado reports as of March 25 compared to 154 tornadoes from January through March, 2011.

Insured losses from tornadoes/thunderstorms in 2011 were over $25 billion—more than double the previous record, says I.I.I.

Forecasters today warn of more severe weather—thunderstorms, hail and possibly tornadoes—in parts of Texas, Tennessee, Kansas, Missouri, Louisiana, Alabama, Mississippi and Florida. The National Weather Service today will look to definitively say how many tornadoes struck Texas on Tuesday.

Below, CNN last night interviews a victim of the storm as video footage and photos of the widespread damage are shown. 

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