Gallagher Re has released its event commentary on the mid-May severe convective storm (SCS) outbreaks in the United States, estimating that primary insurance carriers may face gross losses ranging from US$4 billion to US$7 billion.
The losses from this stretch of severe weather will bring the year-to-date (YTD) total for insured losses from US thunderstorms to more than US$20 billion. This aligns closely with the five-year YTD average of US$25 billion and exceeds the 10-year YTD average of US$19 billion.
It marks the eighth time in the last nine years that SCS-related insured losses have surpassed the US$20 billion threshold on a nominal basis.
According to Gallagher Re, the US has recorded at least eight separate billion-dollar insured loss events from SCS activity so far in 2025. This compares to 13 such events by the end of May in 2024, 11 in 2023, six in both 2022 and 2021, and 12 in 2020.
From May 14 to May 20, at least 29 fatalities were reported, including 27 tornado-related deaths from a single outbreak on May 16 in Missouri, Kentucky, and Virginia. Dozens of injuries were also reported.
Gallagher Re cited 186 tornado reports during the outbreak period, with 112 confirmed tornadoes as of May 22. A confirmed EF3 tornado in the western area of the St. Louis metropolitan region caused damage or destruction to approximately 5,000 properties. City officials estimated damages in that region at US$1.6 billion.
Large hail – measuring two inches or more in diameter – was a major factor in driving losses. The Storm Prediction Center received at least 147 such reports during the period, with some hailstones exceeding four inches in states including Indiana, Kansas, Kentucky, Oklahoma, Texas, and Wisconsin.
Despite a brief lull in the beginning of May, the broader trend remains consistent with recent years. Through the first quarter of 2025, SCS-related insured losses exceeded US$11 billion, making it the third-costliest Q1 for the peril in US history.
By the end of April, 2025 ranked as the fifth-highest year on record for insured losses from SCS events in the United States, trailing only 2023, 2011, 2024, and 2020. Analysts continue to attribute the rise in losses to growing exposure in high-risk regions, with increases in population and housing units contributing to the financial toll.
Frequent occurrences of large hail, straight-line winds, and tornadoes are also seen as key drivers in the escalation of insured losses linked to convective storms.
In addition to the insured losses, early estimates of total economic damage from the May 14 to May 20 outbreak place the figure between US$9 billion and US$11 billion. These projections account for uninsured losses, business interruptions, and other indirect costs such as infrastructure damage and economic dislocation.
A considerable share of the losses is expected to be covered by standard property and casualty insurance, though the wider financial impact may take months to fully assess.
Previously, Gallagher Re’s chief science officer, Steve Bowen (pictured above), said that the financial scope and frequency of SCS events support reconsidering their classification within the industry.
Bowen argued that SCS should no longer be treated as “secondary perils” and should instead be recognized as “primary perils”, due to their repeated and large-scale financial impacts. Reclassification could influence underwriting priorities, capital allocation, and how insurers approach risk modeling for weather-related events.
The persistent rise in SCS losses is also affecting the broader financial performance of property and casualty insurers. As claim volumes rise and loss ratios increase, some carriers are adjusting their underwriting strategies and reviewing premium pricing in high-exposure areas.
Analysts note that these changes may lead to tighter capacity in certain markets, especially for risks involving hail-prone or tornado-prone geographies, potentially influencing both the availability and affordability of coverage in affected regions.
What are your thoughts on this story? Please feel free to share your comments below.
