Full Breakdown
Severe Convective Storms Overtake Other Disasters as Top Insurance Payers
7/28/2026, 12:48:44 AM
Rising Insurance Costs from Severe Convective Storms
A study by climate-risk modeling firm First Street finds that payouts for “severe convective storms” (SCS)—short-duration events such as tornadoes, hail and damaging winds—exceeded those from cyclones in 2025, making SCS the costliest insured natural disaster worldwide. The firm, using data from risk-management consultant Aon, reports that global insurance losses from intense convective storms over the past 25 years total $794 billion, surpassing combined losses from flooding, earthquakes and drought.
Scope and Scale of Losses
In 2025, SCS accounted for one-third of global natural-disaster economic losses. Insured and uninsured losses that year reached $82 billion, with $68 billion concentrated in the United States. The concentration reflects the high density of insured residential, commercial and industrial properties across the country.
Regional Vulnerabilities in the United States
First Street identifies Illinois and Ohio as especially exposed, describing them as lying along a “severe convective storm belt.” The firm also flags North Carolina and Georgia, where dense urban areas such as Atlanta and Charlotte increase potential exposure. Premiums are rising most rapidly in the Midwest and northern Texas, where the frequency of severe storms has expanded.
Official Outlook and Projections
He warns that, if current trends continue, SCS are projected to become the world’s third-costliest natural disaster within the next decade, driven by growing frequency, exposure and damage. The firm expects continued growth in both the number of events and the economic losses they cause.
Verbatim Quotes
- “In the U.S., we have a lot of really valuable real estate,” — Jeremy Porter, first street chief
- “Unlike hurricanes or earthquakes, which concentrate losses in a small number of catastrophic events, SCS generates recurring losses through frequent hail, wind, and tornado outbreaks,” — First Street
- “When a big hailstorm hits an area, it tends to damage everything in the area: homes, cars and infrastructure — whatever's there,” — Jeremy Porter, first street chief
- “We're expecting to continue to see growth in frequency, exposure and damages from these types of events,” — Jeremy Porter, first street chief
