risk management: tip of the week

Hail Season Preparation

The impact that catastrophic hail and wind events have had on property owners and the insurance industry would be difficult to overstate. The National Oceanic and Atmospheric Administration (NOAA) recorded 5,396 major hailstorms in 2019. Those storms affected more than 7.1 million properties in the U.S. resulting in losses of more than $13 billion according to the Verisk report U.S. Hail Damage Insights.

We generally think of hail storms occurring during spring months, but data from the past several years indicates that severe storms can occur throughout the year. The Verisk report notes that the threat of severe hail storms now extends well outside of "hail alley" (Colorado, Nebraska, and Wyoming) to include the Midwest, Gulf Coast, Appalachia, and the desert Southwest. In 2020, the states with the highest number of major hail events were Texas, South Dakota, Kansas, Oklahoma, and Nebraska.

In response to these trends, insurers are applying stricter underwriting guidelines with higher deductibles, increased premiums, and endorsements limiting coverage. Review your coverage with your insurance agent with special attention on valuation. Reconstruction costs, including materials and labor, are on the rise all states. Given the current trends in underwriting and reconstruction costs, a mid-term adjustment to your policy may be a wise investment of your time.

Download a detailed hail action plan prepared by Liberty Mutual Insurance, one of MiniCo's carriers.

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Make it a safe day!

Mike Schofield
President & CEO