FOR RELEASE ON:  April 16,1999
FOR MORE INFORMATION: Mary Bonelli/Daniel Kelso (614) 228-1593

INSURANCE INDUSTRY TALLIES INITIAL TORNADO LOSSES

COLUMBUS–An early morning tornado that ripped through the Cincinnati area on April 9 caused at least $66 million in insured losses, according to the Ohio Insurance Institute (OII). The National Weather Service ranked the tornado as an F4, the second strongest level on the Fujita tornado-damage scale, as winds were clocked at least at 207 mph. Of all tornadoes, only 2% reach the F4 or F5 level.

"It didn't take long to determine that the degree of damage would reach catastrophic proportions," said OII president Daniel J. Kelso.

A catastrophe, in insurance terms, is an event that causes more than $25 million in insured property damage and affects multiple insurers.

Insurance company adjusters and claims personnel are still making loss assessments as new claims are being reported. The Institute expects the final tally of insured losses and claims to be higher than this initial estimate.

"Although our survey does include the majority of insurers who have policyholders in the Cincinnati area, there are likely other insurance companies who have experienced losses as well and their numbers are not included in our survey," said Kelso. "Many insurance companies still have catastrophe teams in the Cincinnati area, and some have even set up mobile offices to assist with their claims handling efforts."

The Ohio Insurance Institute estimates that companies are expecting at least 4,815 insured claims from the tornado and high winds that swept across southwest Ohio a week ago.

"The reason why there are so many claims for such a concentrated area affected by this disaster is because of the severity of the tornado and that these types of losses are covered by homeowners, renters and commercial insurance policies," he explained.

Tornadoes, high wind, hail and similar severe weather-related losses are covered under homeowners insurance "windstorm" peril. Renters insurance also provides coverage to policyholder possessions due to this peril.

A total of 31 property/casualty (P/C) insurance companies participated in the OII claims loss survey, including the top ten writers of personal auto insurance and homeowners insurance in Ohio. The total number of estimated claims ranged from no losses by some regional insurers to 2,000 claims, with dollar losses ranging from $7,500 to $25 million.

Nearly two-thirds of the claims pertain to homeowners insurance coverage. Some of the most common types of losses reported by insurers include total and partial structural losses, heavy damage to roofs and power outage-related losses. Uprooted trees and flying debris also caused substantial damage. Insurers also report that commercial policyholders were filing business interruption claims, as well as claims associated with structural and contents damage. State Farm lost an agency located in the most heavily damaged area.

Over one-fourth of the reported claims were for damaged or totaled vehicles. Auto insurance protection is provided under "other than collision" coverage, which is also known as "comprehensive" coverage.

The OII is a trade and public information association representing insurance companies and agent groups for the property/casualty insurance industry. Its primary objective is to help Ohioans achieve a better understanding of insurance and safety issues.

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Note: For a copy of Ohio's history of tornadoes, contact the OII at 614-228-1593.

Insurance Company Tornado Claims and Loss Estimates (partial list)