Ind. Leads Country with Highest Catastrophe Losses in 2006

January 18, 2007

In a year where coastal states endured no major tropical storms, Indiana saw more property damage due to large weather events than any other state (in 2006), according to statistical firm the Insurance Services Office (ISO). Indiana residents filed nearly 335,000 insurance claims and suffered about $1.5 billion in property damage due to major events – known as catastrophe, or “cat” events.

While there were eight major events in Indiana in 2006, the April 14 hail storm was by far the largest. That storm caused $1.3 billion dollars in damage and led to 282,500 claims being filed. The next largest storm to hit Indiana last year was on April 2 and 3. This “Final Four Storm” famously caused massive amounts of damage to the Regents Bank Building in downtown Indianapolis. By comparison, that catastrophe caused only $60 million in property damage.

Insurance Institute of Indiana President Steve Williams says it remains to be seen how this bad weather year will affect future premiums.

“Insurance premiums have been falling in Indiana for years, and we are in good position relative to the rest of the country,” Williams said. “Companies take a lot of variables into consideration when setting rates. It’s difficult to say what 2006 will do to prices.”

Williams emphasized that Indiana currently ranks 11th in average auto premiums and 22nd in homeowners premiums.

Hoosiers should not expect to see massive rate hikes like some are experiencing in the coastal states. The catastrophe events of 2005 – including Hurricanes Katrina and Rita – caused record losses in those states. This year’s catastrophe costs fell dramatically, as shown below.

Year Insured Loss ($) # of Events
1997 $2.6 billion 25
1998 $10.1 billion 37
1999 $8.3 billion 27
2000 $4.6 billion 24
2001 $26.5 billion 20
2002 $5.9 billion 25
2003 $12.9 billion 21
2004 $27.5 billion 22
2005 $61.9 billion 24
2006 $8.8 billion 33
Total $169.3 billion 258
Source: ISO

Indiana’s catastrophe losses paled in comparison to the top losses of 2005. Below is a chart of the state’s with the most losses in the last two years.

2006 Catastrophe Losses
State Loss ($)
Indiana: $1.5 billion
Missouri: $878 million
Tennessee: $873 million
Texas: $688 million
Kansas $601 million

2005 Catastrophe Losses
State Loss ($)
Louisiana $27.2 billion
Mississippi $12.2 billion
Florida: $9.9 billion
Texas: $2.9 billion
Alabama: $1.5 billion
Source: ISO

The Insurance Institute of Indiana is a non-profit trade association representing insurance companies in the state of Indiana.

Source: Insurance Institute of Indiana