Let it Hail, Let it Hail, Let it Hail! journal.pdf · “Wind and hail-related roofing damage is a...
2
32 INSURANCE JOURNAL-TEXAS / SOUTH CENTRAL April 7, 2003 By Terry Binion T he March 2000 thunderstorm blew in without much warning during the Fort Worth, Texas early evening rush hour. When softball-size hail smashed through the roof of a downtown restau- rant, customer Mario Valverde headed for safety to escape falling debris and glass shards from exploding windows. Valverde, a National Weather Service (NWS) veteran, knew this storm would make national headlines. “The hail punched right through the ceil- ing,” Valverde said. “The hailstones knocked ceiling tiles loose and rainwater cascaded down from the electrical fixtures. I hid out in the restaurant’s freezer room along with the other customers and employees. I found out later the storm killed two people.” An experi- enced weatherman, Valverde knew that the fierce storm had passed directly over his home in Saginaw. “I called my insurer and the claim adjuster told me the roof had to be replaced. Afterwards, property insurance premiums went up ten percent in my area.” Fortunately, most storms aren’t as violent as the one Valverde experienced, and hail larg- er than baseball size is rare. “Ninety percent of hail is golf ball size or less,” said contractor Scott Hamilton, of Lon Smith Roofing in Fort Worth. However, while smaller hailstones may not fracture standard roof shingles, damage still remains. “Hailstones damage asphalt roof shingles by knocking their granular covering loose,” said Texas A&M engineering professor, Dr. Milton Smith. “Once enough granules are knocked off, the shingles’ underlying asphalt is exposed. Then sunlight deteriorates the asphalt and water enters the house.” Wind and hail-related roof losses are an enormous loss pressure for casualty coverage providers. “Roof claims represent a substantial part of most property insurance companies’ portfolios,” said SAFECO Insurance’s Tim Loftin, Regional Property Claims manager in Maitland, Fla. “And insurance premiums are based on losses,” Loftin said. As claim losses mount, property insurers actively seek ways to mitigate them. “Wind and hail-related roofing damage is a national problem,” said Jack Stanton, State Farm Insurance Company’s Loss Mitigation coordinator. “Last year, prop- erty insurance carriers spent over $5 billion on wind and hail-damaged roof claims. The industry simply can’t sustain those losses indefinitely.” Stanton added that “raising premiums is one-dimensional and doesn’t involve the customer in the decision process.” Therefore, “property insurance carri- ers support roof loss mitigation, especially when it gives meaningful options to policy- holders in preventing roof damage,” he said. Roofing standards to the rescue Recent developments in roofing material production promise an effective way to miti- gate roof loss claims, and are within financial reach of most homeowners. Impressive labora- tory and field test results prove how these new materials, often called “impact resistant,” can make homeowner roofs nearly impervious to most wind and hail-related damage. So what is impact resistance? Prior to 1996 it was common knowledge that certain materi- als offered better wind and hail protection than did others, but no defining standard existed. So in 1996, in an effort to tackle the roof loss prob- lem, several property insurance industry experts teamed with the Institute of Business and Home Safety (IBHS) and the Underwriter’s Laboratory (UL) to develop the UL 2218 classification. UL 2218 set a national standard for roof impact resistance by rating materials from Class 1 through 4, based on their resistance to impact testing with steel balls simulating 90- mph hailstones of varying sizes. A Class 4 rating is the toughest. Roofing manufacturers began producing affordable Class 4 roof materials that had been commercially unavailable before 1997. Property insurers with sizeable market shares in storm-prone areas began an information campaign, telling policyholders, agents, roofers and state insurance departments about the advantages impact resistant coverings offered to property owners in terms of reduced roof maintenance and replacement costs. Manufacturers focused on introducing varia- tions of commonly installed asphalt roofing shingles, often called “modified asphalt” shin- gles. Modified asphalt shingles are stronger and more flexible than standard ones. The rubber- like quality prevents hail from fracturing the fiberglass mat, eliminating premature deteriora- tion. The added flexibility also makes the shin- gles more wind resistant, making it harder for high winds to blow them off. Class 4 products made of aluminum, cop- per, plastic and resin shingles have been avail- able for years, but they cost considerably more than standard roofing materials. With the intro- duction of modified asphalt materials, many more homeowners are able to achieve greater wind and hail resistance than ever before. How much protection do the new modi- fied asphalt roof shingles offer? Bend, Kansas homeowner Tom Harris said, “I replaced a wood shingle roof with the new hail resistant materials. Thirty days later we had a huge hail- storm. Afterwards I climbed up and looked around. I couldn’t find one hit on the roof.” John Valiant of Denver-based Cameron Ashley Building agreed. “Impact resistant roofs definitely work, Valiant said. “They can stand Let it Hail, Let it Hail, Let it Hail! Photo courtesy of State Farm Insurance Cos.
Transcript of Let it Hail, Let it Hail, Let it Hail! journal.pdf · “Wind and hail-related roofing damage is a...
32 INSURANCE JOURNAL-TEXAS / SOUTH CENTRAL April 7, 2003
By Terry Binion
The March 2000 thunderstorm blew in withoutmuch warning during the Fort Worth, Texas
early evening rush hour. When softball-size hailsmashed through the roof of a downtown restau-rant, customer Mario Valverde headed for safetyto escape falling debris and glass shards fromexploding windows. Valverde, a NationalWeather Service (NWS) veteran, knew this stormwould make national headlines.
“The hail punched right through the ceil-ing,” Valverde said. “The hailstones knockedceiling tiles loose and rainwater cascadeddown from the electrical fixtures. I hid out inthe restaurant’s freezer room along with theother customers and employees. I found outlater the storm killed two people.” An experi-enced weatherman, Valverde knew that thefierce storm had passed directly over his homein Saginaw. “I called my insurer and the claimadjuster told me the roof had to be replaced.Afterwards, property insurance premiums wentup ten percent in my area.”
Fortunately, most storms aren’t as violentas the one Valverde experienced, and hail larg-er than baseball size is rare. “Ninety percent ofhail is golf ball size or less,” said contractorScott Hamilton, of Lon Smith Roofing in FortWorth. However, while smaller hailstones maynot fracture standard roof shingles, damage stillremains.
“Hailstones damage asphalt roof shinglesby knocking their granular covering loose,”said Texas A&M engineering professor, Dr.Milton Smith. “Once enough granules are
knocked off, the shingles’ underlying asphalt isexposed. Then sunlight deteriorates the asphaltand water enters the house.”
Wind and hail-related roof losses are anenormous loss pressure for casualty coverageproviders. “Roof claims represent a substantialpart of most property insurance companies’portfolios,” said SAFECO Insurance’s TimLoftin, Regional Property Claims manager inMaitland, Fla. “And insurance premiums arebased on losses,” Loftin said. As claim lossesmount, property insurers actively seek ways tomitigate them.
“Wind and hail-relatedroofing damage is a nationalproblem,” said Jack Stanton,State Farm InsuranceCompany’s Loss Mitigationcoordinator. “Last year, prop-erty insurance carriers spentover $5 billion on wind andhail-damaged roof claims. Theindustry simply can’t sustainthose losses indefinitely.” Stanton added that“raising premiums is one-dimensional anddoesn’t involve the customer in the decisionprocess.” Therefore, “property insurance carri-ers support roof loss mitigation, especiallywhen it gives meaningful options to policy-holders in preventing roof damage,” he said.
Roofing standards to the rescueRecent developments in roofing material
production promise an effective way to miti-gate roof loss claims, and are within financialreach of most homeowners. Impressive labora-
tory and field test results prove how these newmaterials, often called “impact resistant,” canmake homeowner roofs nearly impervious tomost wind and hail-related damage.
So what is impact resistance? Prior to 1996it was common knowledge that certain materi-als offered better wind and hail protection thandid others, but no defining standard existed. Soin 1996, in an effort to tackle the roof loss prob-lem, several property insurance industryexperts teamed with the Institute of Businessand Home Safety (IBHS) and the Underwriter’s
Laboratory (UL) to developthe UL 2218 classification. UL2218 set a national standardfor roof impact resistance byrating materials from Class 1through 4, based on theirresistance to impact testingwith steel balls simulating 90-mph hailstones of varyingsizes. A Class 4 rating is thetoughest.
Roofing manufacturers began producingaffordable Class 4 roof materials that had beencommercially unavailable before 1997.Property insurers with sizeable market sharesin storm-prone areas began an informationcampaign, telling policyholders, agents, roofersand state insurance departments about theadvantages impact resistant coverings offeredto property owners in terms of reduced roofmaintenance and replacement costs.Manufacturers focused on introducing varia-tions of commonly installed asphalt roofingshingles, often called “modified asphalt” shin-gles.
Modified asphalt shingles are stronger andmore flexible than standard ones. The rubber-like quality prevents hail from fracturing thefiberglass mat, eliminating premature deteriora-tion. The added flexibility also makes the shin-gles more wind resistant, making it harder forhigh winds to blow them off.
Class 4 products made of aluminum, cop-per, plastic and resin shingles have been avail-able for years, but they cost considerably morethan standard roofing materials. With the intro-duction of modified asphalt materials, manymore homeowners are able to achieve greaterwind and hail resistance than ever before.
How much protection do the new modi-fied asphalt roof shingles offer? Bend, Kansashomeowner Tom Harris said, “I replaced awood shingle roof with the new hail resistantmaterials. Thirty days later we had a huge hail-storm. Afterwards I climbed up and lookedaround. I couldn’t find one hit on the roof.”
John Valiant of Denver-based CameronAshley Building agreed. “Impact resistant roofsdefinitely work, Valiant said. “They can stand
Let it Hail, Let it Hail, Let it Hail!
Photo courtesy of State FarmInsurance Cos.
04.07.03 Texas 3/31/03 9:31 AM Page 32
April 7, 2003 INSURANCE JOURNAL-TEXAS / SOUTH CENTRAL 33
up to a 110-mph wind for a prolonged period.The shingles blow up and curl in the wind, butwhen the wind dies they just settle backdown.”
“Every year, thousands of homeownerslose their roofs to hail and wind damage,” saidState Farm’s Stanton. “We now know that Class4 materials offer some of the best long-termroof protection available tohomeowners.”
Insurers take noteThough impact resistant
shingles cost more, they payfor themselves over the longterm. “These products costten to twenty percent morethan comparable weight,non-impact resistant roofingproducts,” said Ron Bacon,the Property & Casualty LossMitigation administrator forState Farm. But since theyhave increased damageresistance, homeowners whoinstall them will greatlyreduce their roofing mainte-nance costs and may eliminate premature roofreplacement altogether, possibly adding to ahome’s value at resale time.
Further offsetting roof replacement costs,some insurers now offer policy premium dis-counts and higher policy deductibles to theircustomers to help justify the added expense ofinstalling a Class 4 roof. When insurers do offersuch discounts, loss mitigation becomes ahomeowner-insurer partnership, a way of shar-ing some of the claim loss savings with policy-holders in terms of real dollars.
Policy premium discounts can go a longway in helping homeowners recover roofreplacement costs, depending on the proper-ty’s location. “I’m changing my roof,” saidTulsa-based Richard Wells of Enviro GuardLLC, a roof materials developer and a petrole-um engineer. “I have a wood shingle roof, andI pay my insurer almost $2,000 a year. I’ll payabout $550 with the new materials,” Wells said.
Growing acceptanceMarket acceptance of impact resistant roof-
ing was at first spotty, but in 1998, then-TexasInsurance Commissioner Elton Bomer requiredTexas insurers to give premium discounts to pol-icyholders whenever they installed Class 4 typeroofs. This was the first time statewide recogni-tion was ever given to impact resistance as aproven approach to mitigating roof loss, settingthe stage for its widespread adoption.
“New South Florida building codes mayrequire Class 4-type roof shingles,” Loftin said .“Class 4 shingles feature increased impactresistance while also resisting wind speeds upto 100 mph.”
Acceptance of impact resistant Class 4roofing is growing. “Three years ago thesetypes of (modified asphalt) shingles were virtu-ally unheard of,” said Bill Rhees of BMIConstruction, a Tulsa roofing contractor.
Scott Hamilton agreed. “In 1997, we did-n’t install any of the new impact resistant roofcoverings. By 2002 they represented 25 percent
of our business,” he said. Even stronger materials
may become commonlyavailable in a few years.Some roofing manufacturershave begun experimentingwith substances that havebeen used for other applica-tions, but never as roof cov-erings. “We have workedwith shingles made from sub-stances called ‘engineeredpolymers’,” Wells said,explaining that shingles ofthis type are much lighterthan standard compositionshingles, perform under amuch wider temperaturerange, and are 100 percent
recyclable. “They’re tough as nails. I don’tthink a six-inch hailstone would penetratethem. The defense department has even con-sidered testing materials of this type on mili-tary tanks.”
Effectively mitigating wind and hail relat-ed roof loss with Class 4 roofing is a provenreality, within most homeowners’ financialreach. Its broad-based adoption is sure to be ofgreat benefit to casualty insurance providersand their policyholders.
As for homeowners, they might considerArcher County, Texas resident Carl Matlock’sexperience with a Class 4 roof. “I don’t thinkabout storms anymore. I just let it hail.”
Terry Binion provides business consultingservices to insurance companies, agentsand brokers.
IBHS provides a listing of Class 1 through4 materials including composition andcontact information at its Web site,www.ibhs.org/. Following are some man-ufacturers and contractor/distributorsof Class 4 roofing products:• Herbert Malarkey Roofing Company,
Portland, Ore., (503) 283-1191. Web site: www.malarkey-rfg.com/.
• Atlas Roofing Corporation, Atlanta, GA., (770) 952-1442. Web site: www.atlasroofing.com/.
• Owens Corning, Toledo, Ohio, Web site: www.owenscorning.com/.
• ABC Supply, Beloit, Wis., (608) 362-777 has 200 locations in 41 states. Web site: www.abcsupply.com/.
Photos courtesy of State FarmInsurance Cos.
IJ
UpcomingIssue:5.5.03 MGA Issue
This issue will be distributedto the rooms of all thoseattending the AAMGAConference
Ad Deadline: 4.18.03
For Ad Information Call800/897/9965 x123
04.07.03 Texas 3/31/03 9:31 AM Page 33
