Winter storm, 6-02-04 external with legal comment

Issue No. 3 May 2004 2004 United States Winter Storm The winter of 2003/2004 saw significant snowfall and low temperatures. Many companies will experience above average claims and losses related to this winter weather. In this report, Guy Carpenter’s Property Practice provides a brief historical context describing the nature and impact of the peril of winter storms, offers insight into efforts underway to quantify losses from winter storms using cat models, and outlines risk transfer alternatives that insurers should consider to address the adverse financial consequences of severe winter weather. The Winter Storm Peril As defined by the insurance industry, a “winter storm” can involve extreme levels of temperature, precipitation and wind. The cold weather hazard from a winter storm can produce snow, ice, sleet, and extreme temperatures that result in: □ Collapse of structures from the weight of snow and ice □ Downed trees or large branches □ Water damage from freezing pipes that burst □ a ice dams in gutters as snow melts and refreezes □ Power outages □ Flooding □ Auto accidents A Brief History According to ISO’s Property Claims Service (PCS) estimates, since 1980 there have been seven years in the United States in which property losses from winter storms has exceeded $1 billion. (This amounts to once almost every three years.) This past winter was significant in several regions of the country, as is noted in the ...