(June 2013)

INTRODUCTION

Commercial and personal lines insurance coverage forms and policies both cover windstorm and hail damage. As with fire and explosion, they do not define these terms. As a result, dictionary definitions and court precedents must be used to determine losses that are covered and those that are not. The Insurance Services Office (ISO) CP 10 10–Causes of Loss–Basic Form and CP 10 20–Causes of Loss–Broad Form cover windstorm and hail but exclude loss or damage caused by or that results from:

• Frost
• Cold weather
• Ice, snow, or sleet

Note: This does not include hail.

• Interior damage to buildings or structures (or personal property located inside a building or structure caused by rain, snow, sand, or dust) unless these damaging elements entered the interior through breaches or openings made in the roof or walls

The last two exclusions specifically state that the exclusion applies regardless of whether the element was wind-driven or not.

CP 10 30–Causes of Loss–Special Form approaches things a bit differently. It does not specifically list windstorm or hail as covered but coverage applies because neither is excluded. However, it excludes loss or damage caused by rain, snow, ice, or sleet, or damage to personal property in the open. It also limits damage to the interior of the building or structure and to personal property inside from rain, sleet, sand, or dust to apply only if a covered cause of loss first breaches or damages the building and that allows the elements to enter. The limitation states that coverage does not apply unless the building or structure is first breached or damaged, even if the elements are wind-driven.

Related Court Cases:

"Opening" In Roof as Condition of Interior Damage Coverage Examined

Storm Damage Held Not Covered By Virtue Of Ice, Snow, or Sleet Exclusion

Note: All maps used in this article are copyrighted by and used with the permission of CDS Business Mapping at www.cdsys.com.

DEFINITIONS

Several terms must be defined to better understand the coverages provided. Each is the dictionary definition or as defined in scientific or research articles and papers. Black's Law Dictionary does not define any of these terms.

• Rain

The American Heritage Science Dictionary defines rain as water that condenses from water vapor in the atmosphere that falls to Earth as separate drops from clouds.

• Wind

The American Heritage College Dictionary defines wind as moving air, especially a natural and perceptible movement of air parallel to or along the ground.

The American Heritage Science Dictionary defines wind as a current of air, especially a natural one, that moves along or parallel to the ground, moving from an area of high pressure to an area of low pressure.

• Windstorm

The American Heritage College Dictionary defines windstorm as a storm with high winds or violent gusts but with little or no rain.

·       Hail

The America Heritage College Dictionary defines hail as precipitation in the form of spherical or irregular pellets of ice larger than 5 millimeters (0.2 inches) in diameter.

WINDSTORM

Wind and windstorm are different causes of loss. Consider the following loss examples:

• The light breeze that blows through the house from the front to the back often causes the front door to slam. This results in cracked window frames and panes.
• A storm door left ajar slams constantly against the outside wall of the house. This causes a crack to develop in the outside wall.
• A strong blast of wind enters the home through a mesh screen door and blows over a lamp.

Wind causes these losses. Insurance coverage does not apply because the loss or damage is not a direct result of windstorm.

Windstorm refers only to the wind. It does not refer to the rain and water that may accompany it. This very important distinction is frequently made following a hurricane. Hurricanes and tornados are not defined in any insurance coverage, even though both terms contribute to the lively discussion of what is covered. Windstorm damage is limited to damage the wind causes. Water damage that may accompany the windstorm is not covered as windstorm. In addition, sand driven by wind is also excluded.

In August 2011 RiskMeter Online announced that the following are the top ten tornado-prone areas in the United States, based on its research:

• Denver, CO (rural, not urban)

• Hialeah, FL
• Miami, FL
• Hollywood, FL
• Aurora, CO
• Houston, TX
• Commerce City, CO
• Tampa, FL
• St. Petersburg, FL
• North Little Rock, AR

HAIL

Hail falls along paths scientists call hail swaths. Their size can vary from a few acres to up to 10 miles wide, 100 miles long, and leave piles of hail that must be removed by snowplows or bulldozers. Hail causes significant damage to crops in the United States every year, in amounts that run into the hundreds of millions of dollars. Farmers cope with the hail hazard by purchasing insurance.

Hail in the United States is most prevalent in the area known as "Hail Alley." This consists of the states of Colorado, Kansas, Oklahoma, and Texas. Parts of this region average between seven and nine hail days per year. Hail is also much more common along mountain ranges because mountains force horizontal winds upwards. This intensifies the updrafts within thunderstorms and makes hail more likely.

In September 2011 RiskMeter Online announced that the following are the top ten hail prone areas in the United States, based on its research:

• Amarillo, TX
• Wichita, KS
• Tulsa, OK
• Oklahoma City, OK
• Midwest City, OK
• Aurora, CO
• Colorado Springs, CO
• Kansas City, KS
• Fort Worth, TX
• Denver, CO

WINDSTORM EXCLUSIONS AND DEDUCTIBLES

Many insurance companies issue policies that exclude windstorm (or make the coverage subject to significant deductibles) because of concern about potential hurricane damage.

Properties subject to windstorm exclusions may be eligible for coverage in a Beach FAIR Plan. These plans are available in Alabama, Florida, Louisiana, Mississippi, North Carolina, South Carolina, and Texas. They cover virtually all real and personal property in the designated beach area. There are variations in the type of eligible property among the various states. Each state has a maximum limit per structure but the limits change regularly. It is important to investigate the plans in each state to determine the cap. These plans are NOT a substitute for the coverage the National Flood Insurance Program (NFIP) provides. Beach FAIR Plan policies cover only wind damage. NFIP flood policies cover only flood damage.

Related Article: Overview of the National Flood Insurance Program

When a separate windstorm deductible is used, it is usually a percentage deductible based on the limit of insurance, not the value of the loss. Most windstorm deductible endorsements are state-specific and should be read carefully and explained to the insured thoroughly because of the way they are applied.

Note: These same exclusions and deductible forms can be used in areas of the Midwest where hail may be a major concern.

CONCLUSION

When does wind become a windstorm? Was there really hail damage or was it an existing condition? The observation of damage is the only determining factor and damage unfortunately is in the “eye of the beholder.” The claims adjustor and the insured may have differences of opinion that only an impartial court of law can resolve. Because scientific evidence is important to any argument, the following three different wind scales are presented that may be cited to justify either side of the argument.

BEAUFORT WIND SCALE

British Rear-Admiral Sir Francis Beaufort developed this scale in 1805, based on his observations of the effects of wind. He was a British hydrographer (a scientist who studies surface waters, especially with regard to navigating them). This is the earliest formal wind scale. It provides the standards of wind velocity measurements that mariners and the United States Weather Bureau use, with some modifications made for terminology. These meteorological standards are helpful to clarify the meaning of "windstorm" for insurance purposes. This wind scale differs from the others in that it measures straight-line wind forces as opposed to the effects of rotating winds.

The speed of a current of air and its direction determines whether it is harmful or beneficial. A wind current of 19 to 24 miles an hour is classified as a fresh breeze and is not harmful. When wind reaches a speed of 48 miles an hour, it is classified as a strong gale and may cause some damage to fruit crops. At 64 to 75 miles per hour, wind is classified as a windstorm and is dangerous to both crops and property. Hurricanes and tornadoes involve winds in excess of 75 miles per hour. The Beaufort Wind Scale, based on the effect of wind on ships, and adopted in substance by the United States Weather Bureau, appears below.

ENHANCED FUJITA SCALE (EF SCALE)

This scale was introduced to the public in 2007. The previous scale was introduced in 1971 before there were many more advanced meteorological measuring devices. This new table still depends on observations at the scene of the tornado’s impact but more accurately estimates a tornado's speed. Tornadoes may develop a counterclockwise, swirling motion that exceeds 100 miles per hour and cause incredible destruction. Tornadoes occur most often in the central Mississippi Valley region of the United States. It is important to note that neither the size of the funnel nor the length of time it remains on the ground have any effect on the scale.

SAFFIR-SIMPSON WIND SCALE

The Saffir-Simpson wind scale places a hurricane in one of five categories according to its strength. It was created in the early 1970s. Category one is the weakest hurricane strength measured and category five is the strongest. A hurricane's strength is based on its wind speed. The height of the storm surge depends on the slope of the continental shelf connected to the area where the storm strikes. Wind speeds below 74 miles per hour are measured according to the Beaufort Wind Scale. This scale rates the severity of a hurricane based on its barometric pressure, wind speed, storm surge, and damage potential.