Cotality: Severe Convective Storms Emerge as Major Threat

Cotality’s 2026 Severe Convective Storm Risk report warns that severe convective storms are no longer a secondary concern. The analysis shows these events now drive large portions of annual insured losses.

Scope of the threat

Severe convective storms include strong winds, hailstorms, and tornadoes. These events have been frequent historically, but their financial impact is growing.

Insurers face a changing risk profile. They can no longer rely solely on historical weather patterns to forecast future losses.

Hail emerges as a central hazard

The report highlights hail as particularly damaging for property insurers. About 42 percent of properties analyzed, equal to 43.5 million homes, face moderate or great hail risk.

Cotality estimates that if those homes suffered total loss, reconstruction cost value would reach $17.8 trillion. That figure shows a single severe hailstorm can now produce losses comparable to a major hurricane.

Extreme-event modeling

At the 500-year return period, Cotality models all-perils losses near $71 billion for the rarest events. A single extreme hailstorm accounts for approximately $58 billion of that total.

Implications for insurers and modelers

Underwriters must adopt structure-level property data to improve risk prediction and pricing. Detailed building data will support recovery planning and accurate loss payouts.

Catastrophe risk modelers should prioritize identifying higher-risk event concentrations. That approach helps allocate resources and balance portfolios more effectively.

Industry response needed

Insurers, reinsurers, and brokers must rethink exposure management. Enhanced modeling and granular property data are critical to prepare for this new reality.

Filmogaz.com will continue to monitor developments from Cotality and other industry analyses on Severe Convective Storms and evolving loss patterns.