Cats give U.S. insurers gentle landing for 2002 (March 01, 2003)

Catastrophe-related insured property damages in the U.S. totaled US$5.8 billion for 2002, equal to about half the average annual loss over the last ten years, according to estimates released by the Insurance Services Office Inc. (ISO).

Last year saw 25 cat events which generated about 1.8 million claims from homeowners and businesses. The average number of cats per annum over the past ten years has been about 32 events, resulting in an approximate insured loss of US$11.5 billion a year. Last year’s insured cat losses are also in stark contrast to the record US$28.1 billion insured loss incurred in 2001, primarily due to the 9/11 terrorist attacks, the ISO observes.

Cat losses last year occurred in 40 states, with Kentucky proving the costliest with an insured loss of US$885 million, followed by Texas at US$630 million, Louisiana at US$555 million, Maryland with US$289 million and Ohio at US$275 million. The ISO cautions that 2002 final quarter losses, which are still under assessment, may push last year’s cat loss up dramatically. At this stage, the ISO says that the fourth quarter numbers point to an insured loss of about US$1.7 billion based on 540,000 claims from six cat events that affected 23 states. Last year’s fourth quarter insured loss currently stands at the second highest loss for the same quarterly period in the last ten years, the ISO observes.