Insurers: recent Ontario storms can be considered a CAT event
Published: April 17, 2018
Updated: July 24, 2018
Author: Luke Jones
CATEGORY: Home Insurance
The severe storms that has hit Ontario over the last week were probably CAT events, according to insurance providers. Parts of the province were hit by harsh conditions over the weekend, including over gale force winds and six inches of ice pellets.
Rainfall warnings have continued to be issued at the start of the week, and one insurance company says two thirds of its claims are currently coming from water damage. Because of this, it is fair to deem the recent/ongoing storms as a CAT (catastrophe) event. Environment Canada has described the storm as major, noting it knocked out power, felled trees, and caused infrastructure damage.
“This is absolutely a CAT event because of the sheer volume of claims that are coming through, likely for all insurers,” Neil Weir, vice president of claims at Gore Mutual, told Canadian Underwriter.
This assessment was backed by Aviva Canada: “We’re considering and responding to this as a CAT event,” a spokesperson said.
“Water and rain will be the main concern from this storm – with almost 70% of claims this weekend related to water damage and just 30% related to wind,” Aviva added.
Of course, it is not necessarily a CAT event just because insurers say so. Catastrophe Indices and Quantification Inc. defines a CAT event as one that affects many insurance companies and caused property damage in excess of $25 million.
While the raw numbers for the recent storms are not in, insurance companies clearly believe the losses will make the deluge a CAT event. In its report, Environment Canada says the water equivalent from rain and ice was the equivalent of 55.1 mm.
“Initially the expectation was that we would see a significant increase in claims relating to wind damage,” Aviva Canada reported. “It now appears that water and rain will be the main concern from this storm.”