The nor'easter that tore up the Eastern Seaboard this week has created enough insurance losses to qualify as a catastrophe, Property Claims Services said.

But determining the exact amount of damages will probably take an extended period because of flooded roadways, said Gary Kerney, assistant vice president for PCS, a unit of the Jersey City, N.J.-based Insurance Services Office Inc.

Under the PCS catastrophe definition, in order for an event to qualify for a cat designation, there must be an insured loss of $25 million, and it must affect a significant number of policyholders and insurance companies.

Mr. Kerney said the weather system that did the damage began on Friday in Texas and ended on Monday in Maine. It is the eighth PCS-rated catastrophe this year due to winter storms or other severe weather.

At this point, "it's much too early to put a [loss] number on it," he said, noting that among the effects from the storm has been the loss of power for 800,000 utility customers.

He noted that while flooding of homes is not generally covered by private insurers, vehicles with comprehensive coverage are covered for losses.

Mr. Kerney also noted that home damage from wind-driven rain is generally covered by policies, and in some areas rainfall exceeded nine inches.

If wind blows off shingles or is driven into a home, it would normally be covered, he said.

At this point, however, "the problem is you can't drive around and see what the damage is. We have a whole lot of claims that are just not visible."

He said commercial flood losses would also only be covered if the owners bought protection from the National Flood Insurance Program.

Special Reports /

Nor'easter Declared A CAT By PCS

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