Data helps unmask hail risk, a volatile peril with hidden consequences

July 9, 2020 / 2 min read

Hail can produce compelling news footage and an eye-opening spectacle, but as an insured peril it can be stealthy, seeding future claims in the form of damage that may be slow to come to light. Although roof-related claims on the whole tend to be frequent, hail damage often isn’t reported until the property owner discovers it, which can be long after the fact—if at all.

Beyond effects that require immediate repair, more subtle forms of hail damage can include accelerated aging and weathering of roofs on both residential and commercial structures.

Knowing the U.S. regions that are prone to hailstorms—as well as areas of emerging hail risk—can complement claims data to, among other benefits, help insurers mitigate the risk of covering pre-existing damage under a new policy. A new Verisk white paper, U.S. Hail Damage Insights, examines some key topics:

The need for insurers to actively evaluate a property’s hail exposure at point of sale and at renewal to minimize delayed emergence of claims
The overall high-severity nature of hail events, which typically occur at irregular intervals
The broadening swath of hail’s effects beyond the traditional “hail alley” states, while historically vulnerable areas continue to demand attention

This report reviews and summarizes U.S. hail activity in 2019, including severe events and top state and county breakdowns; discusses impacts in the hail alley region; and explores how insurers can make more informed underwriting decisions on this hazard.

Hail is a highly volatile risk, with the level and location of activity varying widely from year to year. According to Verisk research, an estimated 7.1 million properties were exposed to damaging hail in 2019. In addition, Verisk identified the top ten hail states for number of affected properties:

Texas
Colorado
Illinois
Pennsylvania
Ohio
Kansas
Minnesota
Oklahoma
Nebraska
Indiana

While hail alley and the Midwest feature prominently in the list above, Pennsylvania is fourth on the list for number of properties exposed to damaging hail events —a reminder that in any given year, hail can make an impact in an unexpected place such as the Northeast. Wherever hail makes its mark, the potential to save on claims and sharpen pricing is significant with the right tools. While hail patterns are changing and damage leading to claims can often take time to appear, there’s data insurers can use to help them manage hail risk more effectively.

Data helps unmask hail risk, a volatile peril with potentially hidden consequences