Modelled losses, primarily driven by winter freeze, span more than 30 states as burst pipes and power outages compound impacts across southern US
Karen Clark and Company has estimated that Winter Storm Fern will generate $6.7bn in privately insured losses across the US, with freeze damage emerging as the dominant loss driver.
Using its high resolution US Winter Storm Model, the catastrophe modelling firm said the estimate includes insured damage to residential, commercial and industrial properties from freeze, snow and ice, and wind.
Fern brought snow and ice to more than 30 states after developing over the Great Plains on January 23, as an Arctic air mass moved southward from Canada and interacted with warm moist air from the Gulf.
“Fern brought snow and ice to more than 30 states, beginning on January 23 over the Great Plains,” KCC said in its briefing note.
KCC highlighted the unusual meteorological dynamics that drove the event.
“Along with the low-pressure system that was dubbed Fern, an Arctic air mass dipped southward from Canada, bringing frigid temperatures and damaging freeze that persisted into January 27 across most of the country east of the Rockies,” KCC’s said.
Daily minimum temperature records were set across multiple states, including -20°F in Madison, Wisconsin and -12°F in De Kalb, Illinois, with further records tied from Texas to Minnesota.
“The most significant sub-peril for Winter Storm Fern was freeze, followed by snow/ice,” KCC said.
This freeze damage was compounded by widespread power outages caused by ice accumulation.
“The ice felled trees and brought down powerlines, which caused widespread power outages from east Texas to Kentucky, as well as southern New Mexico.
“Properties that experience an extended power outage are more susceptible to damage from cold temperatures, mainly caused by burst pipes,” the modelling firm added.
The report noted that some of the strongest temperature anomalies occurred in Texas, where Austin, San Antonio and Houston recorded historic lows.
Commercial property losses are expected to be disproportionately high compared with residential.
“Burst pipes resulting from freezing cold temperatures cause interior damage and impacts commercial properties more significantly than homes.”
KCC said this is because many commercial buildings are not continuously heated outside operational hours, leaving pipe systems exposed to anomalously low temperatures.
“Commercial claims are also much larger than residential claims, on average.”
Buildings in southern and southeastern states are less prepared for extreme cold, KCC warned.
“Damage from sub-freezing temperatures will be more significant in the southern and southeast states since the low temperatures there were more anomalous and properties are generally less prepared for these low temperatures.”
KCC concluded that the highest insured losses from the event are expected in Texas and Tennessee.
“In all, Fern caused damage and insured losses across more than 30 states. Estimated losses from Winter Storm Fern are highest in Texas and Tennessee,” KCC added.
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