Indiana Has Highest Catastrophe Losses in U.S. in 2006

Jan. 17, 2007

INDIANAPOLIS – In a year where coastal states endured no major tropical storms, Indiana saw more property damage due to large weather events than any other state in 2006, according to statistical firm ISO. Indiana residents filed nearly 335,000 insurance claims and suffered about $1.5 billion in property damage due to major events – known as catastrophe, or "cat" events.

While there were eight major events in Indiana in 2006, the April 14 hail storm was by far the largest. That storm caused $1.3 billion dollars in damage and led to 282,500 claims being filed. The next largest storm to hit Indiana last year was on April 2 and 3. This "Final Four Storm" famously caused massive amounts of damage to the Regents Bank Building in downtown Indianapolis. By comparison, that catastrophe caused only $60 million in property damage.

Institute President Steve Williams says it remains to be seen how this bad weather year will affect future premiums.

"Insurance premiums have been falling in Indiana for years, and we are in good position relative to the rest of the country," Williams said. "Companies take a lot of variables into consideration when setting rates. It’s difficult to say what 2006 will do to prices."

Williams emphasized that Indiana currently ranks 11th in average auto premiums and 22nd in homeowners premiums.

Hoosiers should not expect to see massive rate hikes like some are experiencing in the coastal states. The catastrophe events of 2005 – including Hurricanes Katrina and Rita – caused record losses in those states. This year’s catastrophe costs fell dramatically, as shown below.