Weather patterns in Oklahoma have taken their toll on the local insurance industry. Due to an unexpectedly large number of powerful tornadoes in May, including the devastating tornado that struck Moore, Oklahoma, insurance companies have thus far seen claims for tornado damages in excess of $1 billion in Oklahoma. The figure, however, is expected to be significantly higher when all is said and done; over 91,000 claims have been made since May 19th in connection with tornado damage, and many more claims are expected to be processed in the coming weeks and months as damage assessments are completed. Furthermore, many of the outstanding claims remain unresolved, threatening to push the total liability the insurance industry is facing even higher.
In an effort to expedite the process and payment of claims, the Oklahoma Department of Insurance (the “Department”) is hosting a recovery assistance event to bring together policyholders and their insurance companies. The Department hopes that information-sharing and dialogue between the parties will help streamline the claims process and hasten recovery throughout the state.
There is some concern that the uncharacteristically harsh tornado season may change the insurance landscape within Oklahoma. There are worries from some media outlets that the insurance industry’s “financial resolve” may become weakened by the recent events. Oklahoma Insurance Commissioner John Doak has commented that the Department is closely monitoring insurance company solvency within the state. As insurers continue to face the daunting task of settling all pending and future claims with respect to the recent tornado damage, it remains to be seen whether insurers going forward will adjust premiums upward to hedge against the potential for similar catastrophic damage in the future.
