Hail-Damaged Cars Take Toll on Insurers

Insurance payments in 2011 topped $797 million.

Posted in News

— According to a study released by the nonprofit Highway Loss Data Institute (HLDI), insurance losses for hail-related damage to vehicles more than doubled in 2011 compared with the previous three years.

The HLDI used information from insurers about weather-related losses under comprehensive vehicle coverage, which covers against theft or physical damage for reasons other than crashes.

HLDI matched the dates of those claims to hail events recorded by the National Oceanic and Atmospheric Administration to determine which claims were for hail damage.

The results showed that not carrying comprehensive coverage in South Dakota, Nebraska, Kansas and Oklahoma might be a serious mistake.  Those states had the highest claim frequencies related to hail damage.

In comparison, Alaska, the District of Columbia, Hawaii, Idaho, and Washington consistently have hail claim frequencies that are very low.

The results showed a frequency of 5.9 claims per 1,000 insured vehicles in 2011, compared with 2.9 in 2008 and 2009 and 2.7 in 2010.

The analysis excluded any hail storms that accompanied tornadoes, since it would be impossible to determine which weather event caused the damage that led to the claim.

Results were based on more than 219 million insured vehicles and more than 748,000 claims.

Total claims paid in 2008 were over $471 million, while payments in 2011 topped $797 million.