From Convective Storms to Flood: The Growing Impact of Secondary Insurance Perils
The insurance industry is increasingly communicating with policyholders and the public about non-peak perils as more severe events and losses occur.
As trends continue, policyholders are likely to face higher prices, decreased coverage availability, and increased risk retention through higher deductibles. To mitigate these issues, resilience measures are essential.
Non-peak or secondary catastrophe perils are characterized by high event frequency and localized occurrences that don't typically cause large single events, unlike peak perils such as hurricanes and earthquakes.
Customers are adjusting their deductibles and terms and conditions, either willingly or out of necessity, to purchase insurance due to inadequate coverage for non-peak perils.
2023 was a "quiet record year" with $93 billion in total insurance losses related to natural catastrophes, despite no major headline storms.
