Insurance industry experts used to think it took a powerful hurricane or massive earthquake to generate huge losses.
But in recent years, tornadoes, floods, wildfires and hailstorms have blown away the conventional wisdom.
Last year's spring tornado season, for instance, whipped up more than $21 billion in losses -- more than the 1994 Northridge earthquake and more than any hurricane in the last 20 years, except Katrina in 2005 and Andrew in 1992. Taken together, the storms were the seventh costliest disaster in global insurance history, according to the Insurance Information Institute.
A combination of factors puts us at higher risk for heavy losses, say industry experts who participated in a recent Web-based seminar presented by A.M. Best Co. Inc. and sponsored by Swiss Re.
For one thing, more people are living in harm's way.
"Areas that were vulnerable to tornadoes have experienced dramatic population change," says Kevin Simmons, an economics professor at Austin College in Texas.
A tornado that would have hit a farm field a generation ago now would wipe out a subdivision in the same location.
Development has also spread to fire-prone wild-lands, such as the forested foothills along the Rocky Mountains. More people are moving there for the natural amenities, and the trend will likely continue, says Hannah Brenkert-Smith, environmental sociologist at the Institute of Behavioral Science at the University of Colorado at Boulder. More people means more property at risk in a fire.
More bad weather ahead
Weather patterns also play a role.
, a naturally occurring climate phenomenon that affects ocean temperatures, helped create the "perfect setup of conditions" for the violent tornado season last year, says Megan Linkin, Swiss Re vice president and meteorologist.
La Nina allows cold air from Canada to meet warm, moist air from the Gulf of Mexico while warm, dry air remains in the West. The unstable atmosphere leads to violent weather.