Ratings agency A.M. Best said there is potential for some insurers — particularly the small, geographically concentrated writers — that were impacted by the recent snowstorm in and
around Buffalo, New York, to hit the retention on their catastrophe treaties.
A.M. Best said in its Nov. 26 briefing, titled “Buffalo Snowstorm Impacts Regional Property Writers,” that while the Buffalo region residents are no stranger to lake-effect snow, the recent storm was considerably more extreme than usual, with as much as 7 feet of snow reported in some areas.
The storm was extensive in its scope, stretching in a relatively narrow band, but through a long corridor from Erie County along the lake borders to and beyond Watertown, New York, in the north, A.M. Best said.
Given the nature of the storm, it will take some time before property damage can be inspected and loss estimates can be determined, according to A.M. Best. Estimates will begin to take shape and develop over the course of the next few weeks.
There undoubtedly will be instances of roof and awning collapse, the ratings agency said, and there will likely be numerous claims for damages to porches and appurtenant structures as well as ice dam claims. There have also been reports of door and wall cave-ins.
Additionally, some flooding is likely given the expected moderation in temperatures, A.M. Best said. This will further complicate the ability to obtain damage estimates and will result in water back-up claims. Business interruption claims are likely to be made on commercial policies.
A.M. Best said preliminary feedback from companies impacted by the storm indicates that while the number of submitted claims is sparse thus far, the potential exists for some companies — particularly the small, geographically concentrated writers — to hit the retention on their catastrophe treaties.
A.M. Best said retention levels are moderate and manageable in most cases. The ratings agency said that at this time, it believes that companies have sufficient reinsurance coverage in place to maintain existing financial strength ratings.
Source: A.M. Best
Related Articles:
Snowstorm Recovery Efforts Continue in Buffalo, N.Y.
Buffalo, N.Y.-Area Residents Urged to Prepare for Flooding
More Snow Threatening for Western New York as Flooding Risk
Was this article valuable?
Here are more articles you may enjoy.
Aon Completes $13B Acquisition of Middle-Market Broker NFP 
Trump’s Bond Insurer Tells Judge Shortfall Is ‘Inconceivable’ 
Progressive Gains as Drivers Shop Around for Auto Insurance—Again 
4,800 Claims Handled by Unlicensed Adjusters in Florida After Irma, Lawsuit Says 
