Number Of Lightning-Related Homeowners Insurance Claims Up In 2016, But Severity Down

Florida, Texas, Georgia And Louisiana Remain Top States For Lightning Claims; Lightning Safety Awareness Week is June 18–24
June 15, 2017

FOR IMMEDIATE RELEASE
I.I.I. New York Press Office: 212-346-5500; media@iii.org

NEW YORK, June 15, 2017 — The number of homeowners insurance claims from lightning strikes and electrical surges in the United States rose in 2016, compared with 2015; however, the average cost that insurers paid on those claims fell, according to a new analysis by the Insurance Information Institute (I.I.I.).   

 

The study, done in partnership with State Farm® found:

  • More than $825 million in lightning claims was paid out last year to more than 100,000 policyholders.  
  • Total insured losses caused by lightning rose 4.5 percent from 2015 to 2016, although overall losses have declined 12.4 percent since 2007.
  • There were 109,049 lightning claims in 2016, up 9.7 percent from 2015.
  • Over fifty percent of claims were related to electrical surge damaging components or wiring, while power surges from transformer or service line shorts were also contributing factors.

 

“The average cost per claim dropped 4.7 percent from 2015 to 2016,” said James Lynch, FCAS MAAA, chief actuary at the I.I.I. “However, the overall average cost per claim has risen 42.3 percent since 2007. By comparison,” he noted, “The Consumer Price Index rose only 15.8 percent in the same period.”

 

Homeowners Insurance Claims And Payout for Lightning Losses, 2007-2016

 

Year Value of Claims  ($ millions) Number of Claims Average Cost Per Claim
2007 $942.4         177,100 $5,321.0
2008                  1,065.5         246,200                                 4,329.0
2009                     798.2         185,789                                 4,296.0
2010                  1,033.5         213,278                                 4,846.0
2011                     952.5         186,307                                 5,112.0
2012                     969.0         151,000                                 6,400.0
2013                     673.5         114,740                                 5,869.0
2014                     739.0           99,871                                 7,400.0
2015                     790.1           99,423                                 7,947.0
2016                     825.7        109,049                                7,571.9
Percent change, 2015-2016 4.5% 9.7% -4.7%
Percent change, 2007-2016 -12.4% -38.4% 42.3%

Source: Insurance Information Institute, State Farm®.

 

State by State Numbers

Florida—the state with the most thunderstorms—remained the top state for lightning claims in 2016, with 10,385, followed by Texas (9,098), Georgia (8,037) and Louisiana (5,956).

Top 10 States By Number of Lightning Claims, 2016

 

Rank State Number of claims Average cost per claim Value of claims ($ millions)
1 FL            10,385 $6,526 $67.8
2 TX               9,098                    9,580                       87.2
3 GA               8,037                    8,250                       66.3
4 LA               5,956                    5,291                       31.5
5 NC               5,889                    7,162                       42.2
6 CA               4,764                    9,951                       47.4
7 AL               4,294                    6,604                       28.4
8 IL               3,870                    7,424                       28.7
9 AR               3,422                    5,882                       20.1
10 VA               3,331                    8,036                       26.8
  Top 10            59,046 $7,559 $446.3
  Other            50,003                    8,313                     415.7
  Total U.S.          109,049 $7,905 $862.0

Source: Insurance Information Institute, State Farm®.

 

Homeowners Insurance Coverage

Damage caused by lightning, such as a fire, is covered by standard homeowners insurance policies. Some policies provide coverage for power surges that are the direct result of a lightning strike, which can cause severe damage to appliances, electronics, computers and equipment, phone systems, electrical fixtures and the electrical foundation of a home.  

 

In recognition of Lightning Safety Awareness Week, June 18 – 24, the I.I.I. and the Lightning Protection Institute (LPI) encourage homeowners to install a lightning protection system in their homes. 

 

"Lightning protection systems that follow the guidelines of NFPA are designed to protect your home by providing a specified path to harness and safely ground the super-charged current of the lightning bolt,” said Kim Loehr, Communications Director for LPI, a national organization that promotes lightning protection education, awareness and safety.

 

To locate an LPI-certified lightning protection system installer in your area, click here.

 

RELATED LINKS

Facts and Statistics: Lightning

Lightning Videos

Consumer Alert: The Dangers of Shoddy Lightning Protection System Installations

Infographic:  Got Lightning? Get Grounded

 

ADDITIONAL RESOURCES

Insurance Institute for Business & Home Safety

NOAA/National Weather Service

 

THE I.I.I. IS A NONPROFIT, COMMUNICATIONS ORGANIZATION SUPPORTED BY THE INSURANCE INDUSTRY.

 

Insurance Information Institute, 110 William Street, New York, NY 10038; (212) 346-5500; www.iii.org