As the world counted down to the year 2000, two things were keeping Australians up at night: the Y2K bug and, in April that year, a far more immediate problem falling from the sky at terminal velocity: 500,000 tons of ice. That Sydney hailstorm became a defining moment not just for the Australian insurance industry, but a benchmark event that reframed how insurers worldwide think about severe convective storms. The insured loss at the time was AU$1.7 billion (US$1.21 billion). In today’s money, that figure is closer to AU$8 billion (US$5.7 billion). However, if the same storm hit Sydney tomorrow - or Dallas, or Munich, or Shanghai - it would cost dramatically more. Hail is no longer a regional footnote in the global loss landscape. It has become one of the most consequential and rapidly escalating property perils on earth.
Andrew Stafford (pictured right), FM’s senior vice-president and operations manager for Australia and New Zealand, remembers the 1999 Sydney event vividly.
“When we flew into Mascot [Sydney’s main airport], all you saw around nearly everyone’s houses was a blue tarpaulin because of the damage that was caused by the hail.”
Around 20,000 homes and 70,000 cars were damaged. But what strikes Stafford most is not what the storm did to 1999 Sydney - it’s what it would do to Sydney now, and by extension to every hail-exposed city in the world. The rooftops look very different today, covered not with tiles alone but with solar panels and roof-mounted equipment that is, in most cases, wholly unprepared for large hail.
That shift in the global built environment is central to why hail has climbed so dramatically up the insurance industry’s risk agenda. Michael Hunneyball (pictured left), FM’s operations chief engineer in Australia, framed the physics: “Imagine if you had a cricket ball and you threw that as hard as you could at your house, what’s going to break?” The answer, he said, is terracotta tile roofing, metal roofing - and solar panels.
The 1999 Sydney event produced cricket ball-sized hail. Today’s storms are generating similar or larger stones, while the global proliferation of rooftop solar has multiplied the value at risk on virtually every residential and commercial building they hit.
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“If we’re talking tennis ball and cricket ball size hail, there are really no solar panels out there that are going to withstand some of that large hail damage,” Hunneyball said.
Industry testing standards for solar panels typically cover hail of around 25 millimetres - not the golf ball, tennis ball or cricket ball-sized stones that supercell storms across multiple continents routinely produce.
For decades, hail was classified in the insurance industry as a secondary peril - significant, but overshadowed by cyclones, earthquakes and floods. That framing is increasingly difficult to sustain anywhere in the world. In Australia alone, hail has contributed more than 20% to total gross insured losses over the past 50 years. Stafford offered a sharper characterisation that resonates well beyond Australia’s borders:
“I look at these sorts of hail events as, call it the fastest billion-dollar peril - because in a matter of 15 minutes, half an hour, you’ve got a very concentrated area of damage, mostly in the cities,” he said.
Sydney, Brisbane and Canberra have each been hit multiple times in the past 20 years. But the same pattern - urban, concentrated, brutal in its speed - plays out from the US Midwest to central Europe to coastal China.
FM has now mapped hail risk globally and the hierarchy of losses tells its own story. The United States dominates, with a corridor of extreme hail exposure running from Texas and Louisiana northward to the Canadian border - a zone of frequent supercell storms that generates some of the world’s most newsworthy and costly hail events. Australia sits in second place globally. Europe follows, with northern Spain and southern France bearing the greatest exposure on that continent. In Asia, FM’s publicly accessible global map highlights zones north and south of Shanghai, around Hong Kong, and southern Japan as the primary areas where large hail can occur - regions whose insurance markets are increasingly alert to a peril they have historically underweighted.
The trajectory of losses across every one of these regions is being amplified by the same force: the rapid and largely unprotected rollout of solar infrastructure. Ground-mounted solar farms are multiplying across hail-prone regions worldwide, creating what Stafford called “repair inflation” - when a mass hail event hits a region, specialist solar contractors simply are not available in sufficient numbers, forcing producers to source them from far afield at significant premium. For insurers modelling aggregate exposures across any of these regions, that scarcity factor materially changes the loss calculation.
For global brokers, the hail risk demands informed conversations with clients about where they are building, what materials they are using, and whether the location of a new solar farm, warehouse or industrial facility is genuinely optimised for hail resilience. The peril that was once an afterthought has become, in Stafford’s phrase, the fastest billion-dollar peril in the business.
