The increase in severe weather events, combined with population growth and migration to high-risk locations in the U.S., will result in more claims, a higher incidence of fraud, and higher payouts for insurance companies. This is a recipe for disaster through the eyes of insurance companies. In fact, in the U.S., the average yearly number of billion-dollar weather-related catastrophes — costs normalized to 2007 dollars — increased three-fold between the periods 1980 to 1991 and 1992 to 2007. In addition, the National Insurance Crime Bureau (NICB) reports that 10 percent or more of all property and casualty claims are fraudulent, costing the industry as much as $30 billion each year.
An increase in catastrophic weather-related events will, in all likelihood, result in an increase in the dollar value placed on fraudulent claims. For this reason, many insurance companies are joining forces with forensic meteorologists to more efficiently manage weather-related insurance fraud.
A Changing Climate
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
