$600 million in hail damage takes a long time for body shops to fix
James Thurman’s Volkswagen Passat is sitting in the garage at Haw’s Paint and Body Shop in downtown Fort Worth, where it has been since a March 17 hailstorm smashed the back window and pounded at least 100 dents into its metal skin.
Workers are eager to fix Thurman’s car, but are waiting for a new roof and other parts to arrive. An insurance adjuster has visited the shop multiple times to determine how much of the repairs, estimated at more than $8,500, will be covered.
But Thurman, despite having to live without his car for six weeks and counting, is a realist. He knows that when Mother Nature wreaks havoc on the Dallas-Fort Worth region with hail, tornadoes and other violent acts, residents with damage to their cars, houses and other property are often taken on a wild, emotional ride.
Repairs can take weeks, sometimes months. Unexpected delays are common.
$3.4 billion Damage for which Texans have filed insurance claims so far in 2016.
Residents often scramble in the initial days after a storm to ensure they can get their stuff repaired promptly without being ripped off by unscrupulous businesses. Then, as is often the case, they play a long waiting game.
“There’s no question about it. If you’re in the roofing business or the body shop business, you’ve got to make hay while the hail is falling,” said Thurman, an airline pilot.
When storms hit each year, businesses such as auto repair shops, insurance agencies, rental car companies and roofers kick into high gear as a temporary but large sub-economy emerges in the region. In Texas, $3.4 billion in storm-related insurance claims have already been filed this year — more than during all of last year, according to the Insurance Council of Texas.
More than 1,000 insurance workers from other cities have been brought into North Texas to help process several thousand vehicles per day that — more than six weeks after the region’s biggest hailstorm — are still showing up as claims are filed.
The biggest single event was the March 17 hailstorm that caused $600 million in damage, mostly in Tarrant County. But there have been other hailstorms throughout the past month in Denton, Collin and Johnson counties, and tornadoes in Cool, Haslet, Howe, Stephenville and Tolar.
And the spring season, when violent thunderstorms are most common, is only halfway over.
Despite not having his VW for the past six weeks — and knowing it could be another two weeks before the work is finally done — Thurman said the inconvenience is manageable because he has a second vehicle, a pickup truck that was also damaged in the hailstorm but is still drivable.
“I’m going to have it repaired too, once I take care of the Passat,” he said.
Many others don’t have a second car or truck, and instead have spent the last month and a half in rental cars, often costing insurance companies hundreds or even several thousand dollars.
There’s no question about it. If you’re in the roofing business or the body shop business, you’ve got to make hay while the hail is falling.
James Thurman, owner of damaged car
Some residents have reported difficulty arranging for a loaner car, but car rental companies say such inconveniences are temporary. Enterprise Rent-A-Car, for example, has brought in cars from many other cities.
“We are particularly well-positioned to move vehicles from airports to cities, as well as from city to city, to meet spikes in local demand,” said Lisa Martini, spokeswoman for Enterprise, which rents about a million cars per week nationwide. “We’ve continued to bring vehicles into affected areas, including Dallas-Fort Worth and Houston, so that we can get local residents and businesses back on the road as soon as possible.”
Tarps on rooftops
In the Ridglea Hills neighborhood of west Fort Worth, dozens of homes have blue tarps on their roofs, awaiting repairs to hail and wind damage. At least six roofing companies are working in the area, putting yard signs on properties where they’re working as a free form of advertising.
At least three salesmen have knocked on Mattie Parker’s door unsolicited, offering to fix her roof. One of them was particularly chatty, attempting to charm Parker by dropping the name of a neighbor.
“He said, ‘We are working on Dee’s home down the street and we can work on yours, too.’ I told him I don’t know Dee,” said Parker, who works as Fort Worth Mayor Betsy Price’s chief of staff.
When you live in Texas, you are already paying off your exposure to risk.
Chris Pilcic, State Farm Insurance spokesman
Consumer advocates have warned residents to watch for unscrupulous, out-of-town contractors who attempt to cash in on the surge in demand for roof repairs. But there are many local companies working in the neighborhood, including Venture Roofing of Richland Hills.
On a recent afternoon, Venture Roofing employee Margarito Morales operated a forklift outside a two-story home in the 6200 block of Curzon Avenue. The home was damaged in the March 17 storm.
“Once we get started, it will take about two days,” said Morales, who added that the company has six or seven trucks working various jobs in North Texas.
Part of the reason the job on Curzon Avenue is taking several weeks, he said, is the delayed arrival of DaVinci shingles, which are made of a synthetic, lightweight material designed to withstand punishment better than the old roofing material the next time a violent storm blows through.
Several dozen claims processing centers are still open in the Metroplex, including 10 operated by State Farm, the largest insurer in Texas. Often, the companies set up tents in large open areas — for example, the Farrington Field football stadium parking lot.
Crews of roughly 40 employees operate at each center, and are still seeing about 100 to 300 damaged vehicles per day, a company spokesman said.
That’s a lot of battered — and, in may cases, totaled — vehicles.
Once we get started, it will take about two days.
Margarito Morales, Venture Roofing employee
Often, insurance company workers cut customers a check on the spot for the damage to their vehicle.
“When you’ve got thousands if not tens of thousands of claims, you need help. This is the most efficient way to handle it,” said Chris Pilcic, State Farm spokesman.
So what happens to the totaled cars? In many cases, they are hauled off to a salvage yard, Pilcic said.
In some cases, the customer can keep the car and the insurance check. However, the company may not be willing to fully insure the car going forward, so owners should talk with their agents before deciding whether to keep a damaged vehicle.
Insurance companies understand that the amount of money paid out for a totaled car often isn’t enough for a customer to buy a new car — not without a loan at least — so the companies try to be flexible, Pilcic said.
“Each case is decided individually and there are a lot of factors, such as whether the car is still safe to drive,” he said. “The customer is presented options.”
Can storms such as the one that hit Fort Worth on March 17 lead to higher home and auto insurance rates?
Yes and no.
When insurance companies set rates for their auto and home policies, they are forecasting what kinds of claims may be made in the future. So in essence, when a customer receives an insurance payment for hail damage, they are receiving a benefit they already paid for, Hanna and Pilcic said.
In that sense, no single weather event has an effect on insurance rates.
But the companies can feel a sting from big payouts. For example, Travelers Cos. said earlier this month its first-quarter profit slipped 17 percent as catastrophe costs rose from bad weather including last month’s North Texas hailstorms, according to Bloomberg News.
Progressive was also hurt by the Texas hailstorms. First-quarter net income fell 13 percent to $258.2 million. And Allstate said catastrophe losses were about $538 million in the first quarter, led by costs tied to hail in southern states.
In the long run, hail and tornadoes do impact future rates, because insurance companies project how much they’ll have to pay out for weather damage based in large part on past storms.
“There is a catastrophe component to rates, but that is set over a number of years,” Pilcic said. “Insurance companies don’t set rates to make up for any losses. You’re setting rates to predict what you’re going to have to pay for catastrophes in the future. When you live in Texas, you are already paying off your exposure to risk.”
This story includes information from the Star-Telegram archives.
Costliest Texas storms
Insured Losses (actual dollars)
- $12 billion Hurricane Ike, Sept. 13, 2008, Galveston Island
- $3.5 billion Tropical Storm Allison, June 8, 2001, Houston
- $2.8 billion Hurricane Rita, Sept. 24, 2005, Sabine Pass
- $1.4 billion hailstorm, April 12, 2016, San Antonio
- $1.2 billion tornadoes, Dec.26, 2015, Garland-Rowlett
- $1.1 billion Mayfest hailstorm, May 5, 1995, North Texas
- $890 million hailstorm, June 13, 2012, North Texas
- $885 million hailstorm, April 5, 2003, North Texas
- $850 million tornadoes/hailstorm, April 3, 2014, Denton
- $795 million Hurricane Alicia, Aug. 18, 1983, Galveston
- $775 million tornado/hailstorm, April 3, 2012, DFW area
- $750 million hailstorm, April 28, 1992, Fort Worth, Waco
- $600 million hailstorm, March 17, Tarrant County; and hailstorm on March 29, 2012, McAllen
Source: Insurance Council of Texas