Verisk Assisting Insurers in Identifying Hail Damage

Verisk Insurance Solutions – Underwriting announces the release of Location Hail Damage Score, a new solution designed to improve an insurer's ability to underwrite properties with existing hail damage.

Location Hail Damage Score is developed in collaboration with Verisk Analytics unit Atmospheric and Environmental Research (AER) and powered by its AER Benchmark database. AER Benchmark pinpoints locations of damage-producing hail events using proprietary computer algorithms to analyze high-resolution historical natural hazard information derived from weather radar and other sources.

“Since 2008, U.S. insurers have paid 4.5 million hail claims totaling $32.1 billion,” says Neil Spector, president of Verisk Underwriting. “Despite the high rate of roof-related claims, many properties damaged by hail have not been repaired. This can leave insurers vulnerable to paying for property damage that occurred before a new policy inception.”

Location Hail Damage Score shows the probability that a damage-producing hail event affected any property in the 48 contiguous states. Updated monthly, results also include date of last occurrence and the number of events affecting the property based on historical weather data.

 ”In the United States, the average cost to replace a 4,500- to 5,000-square-foot roof with 25-year three-tab composition shingles is now more than $12,500,” continued Spector. “By identifying just 100 properties with preexisting damage, we estimate Location Hail Damage Score can help individual carriers avoid as much as $1 million in claims payments for damage occurring before the policy term.”

Insurers can implement underwriting rules to trigger specific actions based on LOCATION Hail Damage Score. These include requesting a loss history report, ordering a roof inspection, or potentially eliminating inspections that may be unnecessary. Additionally, an underwriter can use LOCATION Hail Damage Score to reevaluate existing policies in term or at renewal.

The AER Benchmark database is populated by AER Respond, which provides near-real-time high-resolution data analysis of damaging weather and environmental perils. AER helps insurance firms anticipate and manage risks related to weather and climate.