Average home insurance lightning claim goes skyward

By Barbara Marquand on July 22nd, 2013

Far fewer homeowners filed insurance claims for lightning damage than several years ago, but the average cost of a claim has more than doubled, according to a recent analysis of home insurance data by the Insurance Information Institute (III) and State Farm.

Their study found there were 151,000 insurer-paid lightning claims in 2012, down almost 19 percent from 2011, and down 46 percent from 2004. The total cost of claims, however, rose 1.7 percent to $969 million in 2012 from the previous year and was up 32 percent from 2004.

The average claim cost, meanwhile, rose a whopping 142 percent from 2004 to 2012, dwarfing the 21.5 percent rise in the consumer price index over the same period. Last year's average lightning damage claim was $6,400, compared to $2,646 in 2004.

"The average cost per claim continues to rise, in part because of the huge increase in the number and value of consumer electronics in homes," Loretta Worters, III vice president, said in a press statement.

Are you covered?

Standard home and business insurance policies cover damage caused by lightning, such as fire, and some home and business policies cover damage from power surges that are a direct result of a lightning strike. Even when the damage is covered, though, you still owe the deductible.

To reduce risk of lightning damage, the Insurance Institute for Business & Home Safety recommends having a lightning protection system installed for your home. These systems don't attract or repel a lightning strike, but rather receive and route it into the earth, protecting your home and your electronic equipment from harm.

A bolt of lightning can pack up to 100 million volts of electricity, according to the Lightning Protection Institute, so make sure the system you buy is designed and installed according to accepted industry standards. Look for a system that meets the National Fire Protection Association, Lightning Protection Institute and UL requirements, and includes protection for electrical, telephone, cable or satellite TV lines entering the home.

Meanwhile, see if you might qualify for a discount on your home insurance. The Lightning Protection Institute recommends asking your insurance agent if the lightning protection system qualifies for a premium discount under "security protection for external perimeter" or "weatherproofing mitigation" guidelines. Ask the installer to provide system compliance information to forward to your insurance company.

Follow these safety tips from the Lightning Protection Institute during a storm:

When outdoors:

  • Seek lower ground.
  • Never use a tree for shelter.
  • Get out and away from pools, lakes and other water.
  • Stay away from all metal objects, such as fences, power lines and poles.
  • Do not raise umbrellas or golf clubs above you.
When indoors:
  • Your safest place to wait out a storm is inside a building protected by a lightning protection system.
  • Stand clear from windows, doors and electrical appliances. Unplug appliances well before, but never during, an electrical storm.
  • Avoid contact with piping, including sinks, baths and faucets.
  • Do not use the telephone, except for emergencies. Cellphones are safe to use.

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