Stormy weather

As noted earlier, the effects of out-of-date valuation statements can be compounded by the potential for increasingly destructive and costly natural catastrophes. According to data compiled by the National Oceanic and Atmospheric Administration (NOAA), in 2021 the U.S. experienced 20 separate billion-dollar weather and climate disasters, placing last year in second place for the most disasters in a calendar year, behind the record 22 separate billion-dollar events in 2020.³ And the diversity of 2021 natural disasters also made it a standout year. In addition to tropical cyclones Elsa, Fred, Ida and Nicholas, a flock of severe weather events swept across the nation, including:

A winter storm/cold wave event across the deep south and Texas.
Wildfires across Arizona, California, Colorado, Idaho, Montana, Oregon and Washington.
An ongoing drought and heat wave across the western U.S.
Major flooding in California and Louisiana.
Three particularly devastating tornado outbreaks and a powerful derecho windstorm that tore through the Midwest in December.

These sorts of occurrences are often called "secondary perils" by underwriters, distinguishing them from what many view as the primary catastrophic natural hazards of hurricanes and earthquakes. Those primary hazards are the ones most anticipated to cause massive property damage and financial loss but calling the broader range of natural hazards secondary perils in no way diminishes their growing threat. Hail, tornadoes, flood, wildfires, stronger convective storms, extremes of heat and cold and other secondary perils are becoming increasingly dangerous and costly, complicated by shifting weather patterns that are changing the character of natural hazard risk in some regions. For instance, tornadoes are beginning to occur in parts of the country well outside of the traditional "tornado alley." And "100-year" and "500-year" floods due to heavier rainfalls attributed to climate change are happening more often than their categorizations would lead us to believe.

Special Reports /

Inflation, rising catastrophe costs are challenging commercial property lines

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