P-C Insurers CAT Loss For Quarter: $4.9 Billion

P-C Insurers CAT Loss For Quarter: $4.9 Billion

NU Online News Service, July 28, 12:28 p.m. EDT?Severe thunderstorms and tornadoes that ripped through portions of the nation caused an estimated $4.9 billion insured loss claims during the second quarter, Property Claims Services said.

The company, a unit of the Jersey City, N.J. based Insurance Services Office, said the $4.9 billion is the second-highest for a second quarter period in the last nine years. In second-quarter 2001, nine events caused $6.2 billion in insured losses, making that quarter the worst second-quarter for weather catastrophe losses since 1994.

PCS said catastrophe losses for first-half 2003 now stand at $6.3 billion, compared with $3.4 billion for the first six months of 2002 and $6.9 billion in first-half 2001.

According to the company the second quarter produced a near-record number of auto, residential and commercial policy claims. Catastrophe claims frequency from policyholders in 23 affected states was said to be the fourth highest for a second quarter since 1998--the year in which a severe hailstorm struck Minnesota.

The second-quarter losses spiked upward after severe thunderstorms and tornadoes battered 18 states from May 2 to 11. Insured losses from those storms, PCS said, now stand at $3.13 billion, up $1.58 billion following the unit's resurvey of its preliminary $1.55 billion May estimate.

PCS said it resurveys catastrophe losses about 60 days after issuing its preliminary estimate whenever losses exceed $250 million or when the specific circumstances relating to a catastrophe require additional analysis.

Among the states sustaining losses, Texas topped the list for insured losses in the quarter at $1.18 billion, followed by Oklahoma at $1.07 billion, Tennessee at $770 million, Missouri at $455 million and North Carolina at $205 million, PCS said.

PCS defines a catastrophe as an event that causes $25 million or more in insured property losses and affects a significant number of property-casualty policyholders and insurers.