Reasons for spike in hailstorm losses not clear

| Jun 27, 2019 | Homeowner Claims

Most homeowners in Florida are aware of the potential for hailstorm damage, especially during the summer months when storms that can produce frozen rain are more likely to occur. But something odd happened in 2008: That year, nationwide hail-related losses passed the $19 billion mark in inflation-adjusted dollars. This figure was a big jump from previous figures of $8 billion to $12 billion. However, this spike wasn’t a one-time anomaly.

The higher-than-normal totals for hailstorm losses remained around the same level for the next decade. Both weather-watchers and insurance experts have no clear explanation for why this trend started in 2008. One theory is that larger hailstones and greater storm frequencies reported post-2008 may be a factor contributing to the rising costs. Even so, 2011 is the only year since the higher costs were first noted that had a dramatic increase in the number of hailstorms that occurred.

Another possible explanation is the gradual expansion of cities. As urban areas become larger, there’s increased potential for storm-related damage. The head of a company that provides financial protection to insurance companies believes that more people possessing expensive things that cost more to replace could be another contributing factor. According to an industrial insurance provider, hail-related losses are highest in areas that stretch from North Dakota into Texas, which supports assertions by some forecasters that it’s where a storm hits that matters, not storm frequency. The company notes that damaged roofs account for their clients’ biggest losses.

When hailstorm damage occurs, insurers in Florida are required by law to process claims within a reasonable period of time. Should a claimant have difficulty either receiving a response or securing approved funds, a homeowner claims attorney might make an attempt to facilitate the process. If there is evidence of “bad faith” actions, a lawyer may investigate to determine if further legal action is necessary.