Insurers hit by minimum $4bn payout from Oklahoma storm damage

Insurers face a minimum $4bn payout from the tornadoes that hit Oklahoma in May, Aon Benfield’s latest Global Catastrophe Recap report reveals.

Several US areas were hit by several severe windstorm events in May, including Moore, Oklahoma, where the catastrophic EF-5 tornado killed 24 people, injured 387 others, and damaged or destroyed up to 13,000 homes and structures.

The total economic losses were expected to approach or exceed $5bn, with insured losses of $2.5bn or more anticipated.

In a second prolonged severe weather event, at least 76 tornadoes touched down, including an EF-5 tornado with 475kmph winds and a US-record 4.2km path width that struck El Reno, Oklahoma. Large hail, including a major hailstorm in Amarillo, Texas that resulted in a $400m insured loss, flash-flooding in the Plains and Midwest, and damaging winds in the Northeast were also recorded.

The total economic losses are expected to be beyond $2bn, with insured losses in excess of $1bn.

Two additional stretches of severe weather also affected parts of the Plains and the Southeast, causing a combined economic loss of $700m and insured losses of $375m.

Aon Benfield’s Impact Forecasting president Steve Jakubowski said: “The month of May is historically the peak of tornado season in the US, and after a relatively benign start to the month, tornado activity became much more prevalent during the last two weeks.

Images from the aftermath of the EF-5 tornado in Moore, Oklahoma, show the destructive power of the peril and how devastating impacts can be when tornadoes of such magnitude track through densely populated areas. High insurance penetration will help to alleviate the pressure on those affected, and the recovery is already well under way.”