Hazards

Introduction

 When spring comes many people are relieved that winter is over and the mess of snow and ice are behind us. However, spring is just the beginning of seasonal weather that can cause significant damage to property and generate claims. February to April is snow melt season; as the snow melts, flooding is possible, and many people overlook flood insurance because they are not by the ocean, a lake, or river. Plenty of areas nowhere near water flood due to snow melt.

FEMA lists four different types of spring flood risks. The first is spring thaw, which is when warmer temperatures melt existing ice and snow and produce a large amount of water runoff at once. Frozen ground prevents the melting snow or ice from seeping into the ground, forcing the water to runoff into lakes, streams or rivers, and causing excess water to overflow the banks. Each cubic foot of compacted snow contains roughly 7.48 gallons of water. In many areas locals call this mud season.

Then come spring rains, which can bring several inches of rain in just a few hours or the storm can stall over an area for days. These heavy rains can saturate the ground, leading to the overfilling of storm drains or rivers to overflow their banks.

Next we have flash floods, which occur when a low-lying area is flooded in less than six hours caused by intense rainfall from thunderstorms. They also occur in drought conditions when the ground is so dry that water at first runs off instead of soaking into the ground.

The last thing FEMA mentions as a spring flood risk is levees and dams. As they age and weaken over time, they can be overtopped or fail during larger flood events. During Hurricane Katrina levees and floodwalls fell in more than fifty locations flooding 80 percent of the city.

Tornado season begins April 1 and runs through July. Predictions for 2021 are that this year will be slightly above normal, with predictions ranging from 1,350 to 1,500 for the year. The annual average is between 1,250 and 1,400. Severe thunderstorms increase the chances of tornado formation. 

A recent study shows that the number of strong tornadoes has been significantly underestimated. Because of their short duration, the strength of the winds is often estimated based on the amount of damage to existing structures in the tornado's path. When tornadoes move over a well populated area, there is plenty of damage to review to estimate the wind speed of the storm that just passed by. However, when the storm moves over open fields, there's no damage to view. In order to accurately determine wind speed using radar, the radar has to be within a certain distance to give an accurate reading.  Not all buildings are created equal, and the angle at which the tornado struck a building may also have an effect on the amount of damage reported.

An analysis of wind speed data gathered by Doppler radar from tornadoes that had been rated by the National Weather Service showed that overall tornado categories are 1.2 to 1.5 categories lower than they should be.

June brings both hurricane and wildfire seasons. While the east coast is threatened by hurricanes, the central and western parts of the country are threatened by droughts and wildfires. Along with the threat of wildfires the threat of dust storms exists; anytime there are droughts and dry land, dust storms can become an issue.

With the changing climate the wildfire season has become longer and longer. Burn scars, areas where vegetation has been burned away leaving charred ground, are areas ripe for mudslides when spring rains start. New research from the United States Geological Survey predicts that post-wildfire landslides are now likely to occur each year in Southern California, and that the region can expect major landslides every ten to thirteen years. A major landslide is one that can damage forty or more structures.

The National Centers for Environmental Information's billion-dollar disaster report showed that 2020 was a historic year for extreme events. There were twenty-two separate billion-dollar weather and climate disasters across the United  States costing $95 billion dollars. The costliest events were Hurricane Laura with $19 billion in costs, the Western wildfires with $16.5 billion in costs, and the August midwest derecho with $11 million in costs. Over the past fifteen years, from 2006 to 2020, disasters have cost $1.036 trillion. April through September have the most billion-dollar disasters.

As an agent, you want to do what you can to alert your insureds before weather gets ahead of them and they find themselves under or uninsured and unprepared to handle a loss. More importantly, there are steps they need to take to protect themselves from injury as well. Many things apply across multiple situations.

 Inventory

The importance of a home inventory cannot be stressed enough. An insured who has an inventory of belongings is in a much better position in event of a loss. That way, whether property is burned, flooded, blown away, or otherwise destroyed, the insured has a catalog of his belongings and can readily provide the carrier the required inventory list. There are many free smart phone apps including HouseBook, All My Stuff, Encircle and others; many carriers also have their own apps or software on their websites that an insured can use to build an inventory. An advantage of a smart phone app is the ability to take pictures of items that immediately shows exactly what the insured had. Another important action is keeping receipts; while some carriers may not request receipts, especially in these days of identity theft where people are advised to shred documents, a record of receipts for big purchase items is important. An insured can scan them into the computer or take photos of the receipts and store them electronically so that in case of a dispute there is a record of when and where the item was purchased and the purchase price. A copy of the inventory should be given to the agent or the company so that the record is safe in event of a total loss.

Once an inventory is created, coverage needs to be reviewed: is it adequate? Many people underestimate the amount of property they have. Once you add up all the towels, lamps, silverware, CDs, DVDs, and other items including what is in the junk drawers, the insured may need to increase limits. See Duties After a Loss: Home Inventory for important steps in creating an inventory.

 Hazards

Next look at the hazards the insured is most exposed to. Is he in a high snow area where snow melts routinely lead to flooding? Is the insured in a known flood, wildfire, earthquake, hurricane, tornado, or other area? Have any of these areas expanded over time, such that while it wasn't a hazard when the insured moved in, it is more of a hazard now? While fire is always a covered peril, there are areas where those in wildfire areas may be required to maintain defensible space. Knowing how to do so, and being able to coach your insureds in doing so, can help your insureds avoid or at least mitigate a fire loss. Maintaining clear space around the dwelling, a certain amount of space between trees so fire cannot jump from one to another, and planting drought resistant and native plants all help in wildfire areas. In certain areas with frequent wildfires carriers may be requiring that such mitigation measures be taken in order for a property to be eligible for coverage. Information on setting up and maintaining a defensible space can be found here. 

With tornadoes or hurricanes the removal of anything that can become airborne is important; both tornadoes and hurricanes have great winds and can throw loose objects into or through dwellings and cause significant damage. As tornadoes arise with little to no warning, encouraging an insured to maintain a clear yard is helpful. See Disaster Compendium Part I for information on tornadoes and hurricanes.

Earthquakes require particular home maintenance as well. As items shake and fall during an earthquake, ensuring that pictures are hung securely to walls, items in cupboards or on mantels are secure, or that items are not kept on mantels at all is important. Furniture should be anchored to the walls as well. Another thing to consider aside from whether or not the insured is in a traditional earthquake zone is whether or not the insured is in an area where fracking has begun. The United States Geological Survey now tracks earthquakes caused by fracking and not just earthquakes caused by tectonics. As earth movement is not covered under traditional policies, advising insureds to add endorsements or purchase separate earthquake coverage is important for those exposed to the risk.

Every insurance agent knows homeowners and commercial property policies do not cover flood; the National Flood Insurance Program starts running commercials in April advising people that standard property policies do not cover flood yet still many, many people do not obtain a flood policy. While it may be expensive, it is usually much more expensive to sustain a loss and replace all the drywall in a lower level than purchase the coverage. At the least, an insured should be made aware of the risks and advised to not store items on the basement floor. Items should be kept up on shelves and off the floor; valuable items should be kept in other areas of the home. Remember, the flood policy has a thirty-day waiting period, so the discussion should be had well before hurricane season starts. Disaster Compendium Part III provides details on earthquakes and floods.

For decades flood insurance was primarily provided through the National Flood Insurance Program (NFIP). With better modeling, access to coverage through private carriers is becoming more available. ISO has developed both a commercial flood program and a personal flood program. 

Wildfires, dust storms, blizzards, and volcanoes are other natural disasters that are problematic. The National Oceanic and Atmospheric Administration (NOAA) reports that wildfires burned 10,274,679 acres in 2020 which is the most on record. There were 58,258 fires that year, and the fires burned 176.4 acres per fire, again the most on record.  

By August of 2020, every state from the Great Plains to the West Coast had experienced drought. Much of the Northeast was also in a stage of drought, and other pockets existed in the Midwest, Plains and Hawaii. Drought only enhances wildfires, making it easier for vegetation to burn and fires to spread rapidly. Parts II and IV of the Disaster Compendium contain information on these types of disasters. Disaster Compendium Part II and Disaster Compendium Part IV.

There are a number of different terms used for watches, warnings, and advisories for various types of weather. Knowing these terms lets you know just what to expect from oncoming storms. See Weather Terms You Should Know for a summary of the most common terms.

One of the most important things an insured can do is have a plan and an emergency kit with medications, important papers—including medical records for pets—cash, and basic first aid supplies. Also needed is knowledge of various safe actions: what areas of a building are safest in a tornado, and what if you are in a vehicle? What if you are in a vehicle and the road floods, or wildfires overtake you? Sharing this knowledge with your insured can help him be prepared in event of a disaster. There are many online resources: ready.gov provides information for biological, chemical, cyber, drought, earthquakes, floods, fires, hurricanes, landslides, tornadoes, wildfires, and other types of disasters with instructions on what to do before, during, or after such an event. Resources are listed in the compendium for each type of disaster.

4/3/17