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U.S. NEWS Thursday 10 augusT 2023

Unprecedented levels of damage from storms this year is

upending US towns and the insurance industry

Mariana Valenzuela sifts through the tornado damaged home
of her aunt and cousins in Perryton, Texas, on June, 16, 2023.
(AP Photo/David Erickson, File)

By Michelle Chapman The figures for the first half
Associated Press of the year are in line with
(AP) - Waves of severe a report last month from A person stands outside of a damaged home after a tornado hit May 13, 2023, in the
thunderstorms in the U.S. another reinsurer, Munich unincorporated community of Laguna Heights, Texas near South Padre Island.
during the first half of this Re, which said the series of (AP Photo/Julio Cortez, File)
year led to $34 billion in thunderstorms that raked for the “physical and finan- furniture store. He also lost they’ll no longer write new
insured losses, an unprec- Texas in June was the most cial risks of future climate- some vehicles. policies in the nation’s most
edented level of financial expensive single event in related weather events.” Symons said he is like most populous state.
damage in such a short the U.S. for the year so far. Reinsurers are the insurance residents in Perrytown in Last month Travelers said
time, according to Swiss Re The overall loss from those industry’s insurers, covering that he is still arguing with in- catastrophe losses dou-
Group, as climate change storms alone is estimated at losses that could upend an surance companies. Some bled in its most recent quar-
contributes to the frequen- approximately $8.4 billion. individual company. residents have sought his ter and the company, con-
cy and severity of violent “Devastating storms, which Munich Re and Swiss Re assistance as mayor. sidered a bellwether for the
meteorological events. now seem to be the norm have operations across the “There’s not a whole lot we insurance industry due to its
Damages from convec- rather than the exception, globe, including the U.S. can do for them as a city,” size, said it lost money.
tive storms in the U.S., those are expected to continue Kerry Symons is a business- he explained. AAA has said that it will not
that can come with hail, to grow in intensity and se- man in Perryton, a town One lesson Symons has renew “a very small per-
lightning, heavy rain and verity,” wrote Marcus Win- of about 8,500 in the Tex- learned from the ordeal is centage” of homeowners
high winds, accounted for ter, CEO, North America at as Panhandle, one of the the importance of an an- and auto insurance poli-
nearly 70% of the $50 bil- Munich Reinsurance Amer- communities struck by a nual accounting for the cies in hurricane-wracked
lion in global catastrophic ica. tornado in June, and he is cost of what is inside a Florida, joining other insur-
damages so far this year, Winter said that it is “imper- also its mayor. Three of his building and what it would ers in limiting their exposure
the reinsurer said Wednes- ative” to act immediately buildings were damaged cost to rebuild. One of his in the Sunshine State de-
day. Those global figures in preparing communities and destroyed, including a buildings, a furniture store, spite efforts by lawmakers
includes earthquakes in was acquired recently so to calm the volatile insur-
Turkey and Syria. the valuation was easy. ance market.
The storms in the U.S. were Another building that he AAA insists it’s not leaving
so severe, there were 10 has owned for 20 years has Florida, but that last year’s
that resulted in damages proved more difficult. devastating hurricane sea-
of $1 billion or more, al- The increasing frequency son had led to an unprec-
most double the average of extreme weather has edented rise in reinsurance
recorded over the past de- created disruptions within rates, making it more costly
cade, according to Swiss the insurance industry and to operate there.
Re, and Texas was the state some insurers have retreat- Florida has struggled to
most severely effected. ed from states that are get- maintain stability in the
There have been a mul- ting hit hard, such as Florida state insurance market
titude of high profile me- and California. since 1992 when Hurricane
teorological events to start The pullback by insurers is Andrew flattened Home-
the second half of the year happening despite years stead, wiped out some in-
including heatwaves in the of skyrocketing premiums surance carriers and left
U.S., northwestern China for property owners in hard many remaining insurers
and southern Europe, and hit states. anxious about writing or re-
wildfires on Greek islands, State Farm and Allstate newing policies in Florida.
Italy and in Algeria. have pulled back from Cal- Risks for carriers have also
Damages and insurance The damage caused by a tornado to Beamer Place Apartments ifornia’s home insurance been growing as climate
in Houston is seen on Jan. 25, 2023.
losses from those events (Yi-Chin Lee/Houston Chronicle via AP, File) market, saying that increas- change increases the
are still being tallied, Swiss ing wildfire risk and soaring strength of hurricanes and
Re said. construction costs mean the intensity of rainstorms.q