The heavy snowfall of the winter is hopefully behind us at this point, but with the advent of spring upon them, property owners and insurers may soon realize that the new season comes with new risks.
This blog has previously looked at how temperature fluctuations may have caused damage to snow- and ice-covered roofs as the winter drew to a close. That risk may be receding as temperatures gradually rise to more sustained highs, but spring, like any other season, brings a unique range of concerns about severe weather that can result in property damage.
TDI: Now is the time to take action to manage risk
The Texas Department of Insurance (TDI) recently distributed a press release urging the state's residents to take action now in order to reduce potential property damage as a result of the spring season's weather, which can include hail, wind storms, flash floods and wildfires.
Among the TDI's recommendations are some basic precautions, such as securing lawn furniture and cutting down overhanging branches on trees, which may "become projectiles during strong wind conditions." Another vital piece of advice offered to homeowners is to review insurance policies and "make sure your insurance coverage is still appropriate to what you own."
If a property has been expanded or refurbished recently, the owner's insurance policy may need to be updated to account for the greater cost of replacing the structure. Even if the property itself hasn't changed, the same is not necessarily true of the cost of building materials and labor. There are many factors that can affect construction costs and insurance policies need to account for all of them to ensure policyholders are adequately covered.
Hail damage a particular concern in Texas
In 2013, State Farm Insurance paid out more than $3 billion in claims related to wind or hail damage to U.S. properties. More of these claims were filed in Texas than any other state and historical data shows that hail has long been one of the most significant concerns for residents. From 1999 to 2012, hail accounted for a greater portion of the insured losses suffered by Texas homeowners than any other type of severe weather. During this period, insured losses due to property damage caused by hail in Texas reached a total of $12 billion — almost $1 billion per year.
Due to the threat posed by hail, wind, floods and other inclement weather that arises in Texas during spring, accurately calculating the cost of replacing insured properties is imperative, because this enables insurers to write policies for the appropriate amount and charge policyholders the appropriate premiums. These concerns are relevant for property owners and insurers all over the country.
Risks affect both residential and commercial properties
Homeowners aren't the only ones who stand to be affected by extreme weather. Commercial properties can also suffer extensive damage from hail and other types of storms. Owners of homes or commercial real estate may typically think of the value of their properties in terms of how much they could be sold for in the real estate market, but this figure does not necessarily align with how much it would cost to rebuild a structure in the wake of a disaster, which is the primary concern for insurance carriers.
e2Value offers easy-to-use solutions for accurately calculating Insurance-to-Value
Without an accurate valuation for a building, an insurer may end up writing a policy that does not cover the full cost of replacement. In the event of a disaster, the property's owner might then have to pay out of pocket to rebuild the same structure or rebuild less than the previous structure.
By using e2Value's patented estimator, insurance carriers can accurately calculate the full cost of replacing any property they insure. Our system draws on multiple data sources, and applies its extensive logic architecture and proprietary algorithms to produce accurate values. This, along with a customizable user experience and a standardized approach to calculating replacement costs, allows users to enjoy both flexibility and consistency.
Fast and accurate results
e2Value is proud to offer Pronto, the online replacement cost estimator that enables a user to input only a property's address and instantly receive a complete valuation report with data scoring and risk mapping. With unfettered access to these reports through our Smart Data Warehouse, insurers can update estimates at any time to ensure their policies stay up to date and cover changes in structures themselves or the cost of building materials and labor in the area where a property is located.
Pronto is available for both commercial and residential properties, making it a valuable resource for insurers with a diverse book of business.
Spring may be blooming, but before you start smelling the roses, make sure your firm is prepared for the seasonal change in the weather and the accompanying risks. With quick and accurate valuations, Pronto allows insurers to provide peace of mind to the property owners covered by their policies.