ATLANTA, Oct. 23, 2019 /PRNewswire/ -- LexisNexis® Risk Solutions released its fourth annual LexisNexis Home Trends Report today. The study highlights the impact that 2018 extreme weather events had on catastrophic losses and weather-related peril losses, especially in states impacted by Hurricanes Florence and Michael and the California wildfires. As a result of these events, more than half (56%) of all catastrophe claims came from just four states: California, Colorado, Florida and North Carolina, which is up 20% from the 36% of claims these states accounted for in 2017. As demonstrated by this increase in state specific claims, the report underscores the growing need for insurers to understand and respond to by-peril loss trends and the potential for climate change and extreme weather to drive these losses.
2018 Natural Disasters Drove a Nearly 20% Increase in Claim Severity
In 2018, for the third consecutive year, catastrophe claims accounted for more than 30% of all peril claims, but while frequency decreased, claim severity increased by 17% due to the magnitude of damage caused by this year's natural disasters, including:
- Ferocious Wildfire in California - While fire losses have continued to increase since 2012, catastrophe claims accounted for nearly 40% of fire losses in 2018 – the highest in a decade and a significant jump from the previous high of 15%.
- Catastrophic Hurricane Damage in North Carolina and Florida - 2018 was the worst year on record for wind severity, up 15%, driven by the hurricane devastation to North Carolina and Florida. As a result of the damage caused by Hurricane Florence in North Carolina, September 2018 was 17 times costlier than a typical September in the state.
- Hail in Colorado and Texas - Colorado ranked the highest in loss cost overall for 2018, as well as the highest over the six-year period (2013-2018) the study tracks. Texas continued to top the nation for hail claims, representing 29% of total claim volume.
- Water in Maryland - In January 2018, Baltimore experienced record low temperatures, which drove the severity of freeze claims 45% higher than the six-year average.
"In the context of increased volatility and severity of weather-related events, this year's report provides key insight into alarming by-peril trends," said George Hosfield, senior director, Home Insurance, LexisNexis Risk Solutions. "It is extremely important for home insurers to stay informed of the challenges outlined in this report, especially the volatile and dynamic nature of weather-related loss trends in recent years."
For more information, visit the interactive website for the 2019 LexisNexis Home Trends Report.
About LexisNexis Risk Solutions
LexisNexis Risk Solutions harnesses the power of data and advanced analytics to provide insights that help businesses and governmental entities reduce risk and improve decisions to benefit people around the globe. We provide data and technology solutions for a wide range of industries including insurance, financial services, healthcare and government. Headquartered in metro Atlanta, Georgia, we have offices throughout the world and are part of RELX (LSE: REL/NYSE: RELX), a global provider of information and analytics for professional and business customers across industries. For more information, please visit www.risk.lexisnexis.com and www.relx.com.
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