Gallagher Re: Insured losses from severe weather in Central, Southern US could reach $3 billion

By Mia MacGregor

April 11 - (The Insurer) - A severe weather outbreak across the Central and Southern U.S. earlier this month is expected to result in combined insured losses between $1 billion and $3 billion, according to preliminary estimates from Gallagher Re.

The event caused extensive damage to homes, commercial properties, vehicles and agricultural assets across the Midwest, Mid-South and the Lower Ohio and Mississippi River Valleys, Gallagher Re said. Torrential rain, catastrophic flooding, tornadoes, large hail and destructive straight-line winds were recorded.

On April 2 alone, nearly 300,000 customers experienced power outages. The storms claimed 25 lives and left dozens more injured.

Gallagher Re noted that most of the wind and hail-related damage is expected to be covered by insurance. However, the majority of the flood-related property losses are likely to be uninsured due to extremely low participation in the National Flood Insurance Program in many of the hardest-hit counties.

"A preliminary estimate of combined losses for the private insurance industry and federally run insurance schemes (such as NFIP and the USDA’s Risk Management Agency crop insurance program) was initially anticipated in the range of $1 billion to $3 billion," the reinsurance broker said.

In some areas of Kentucky, Tennessee and Arkansas, fewer than 1% of homes had active NFIP coverage, Gallagher Re said. The highest concentration of flood insurance claims is expected to come from counties directly bordering the Ohio and Mississippi Rivers.

“Given the low take-up elsewhere, the expectation was that a sizeable portion of residential property damage was likely to be uninsured. This would mean a notable protection gap for this portion of the event,” the report stated.

Gallagher Re also emphasised Kentucky’s particular vulnerability to flooding disasters, noting that the state has experienced large economic losses from floods in recent years, including in February 2025 and in prior events during 2022 and 2023.