Insurance Giants Hit by Illinois Tornadoes

Posted & filed under Car Insurance News.

The Bloomington, Ill. based insurer has paid out nearly $1.75 Billion to its customers since some of the worst thunderstorms and tornadoes the area has seen in years devastated great swathes of the landscape in April and May this year.

Fortunately, State Farm seems upbeat about its ability to handle the catastrophe, and has so far not let any insured policyholders down.

“Our policyholders have experienced an extraordinarily devastating spring, and we are very proud of the remarkable job all our associates are doing to help our customers recover,” Brian Boyden, State Farm’s executive Vice President, said in a statement.

Year’s Payouts in Excess of $3.3Bn

Unfortunately for State Farm, this year has been a bad one for disasters.   Total payouts for disaster cover this year have exceeded $3.3Bn, though this number includes residual payments for disasters that occurred in previous years.

State Farm isn’t alone, either. Allstate Insurance announced in a statement earlier this week that they too were facing pre-tax losses of up to $2 Billion after the storms in April and May.

The storms this April and May were some of the worst in Illinois history, with a record number of tornadoes being spotted.   Over 1,400 were reported between April and May, and 536 people have been killed this year alone by tornadoes.

Boston-based catastrophe modeler AIR Worldwide Corp. estimated recently that losses for the insurance industry as a whole resulting from the storms in April and May could reach as high as $7 Billion.