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🌀 '''Windstorm''' is a [[Definition:Peril | peril]] classification in [[Definition:Property insurance | property insurance]] that refers to damage caused by high-velocity winds, including those generated by hurricanes, tornadoes, derechos, and severe thunderstorms. Insurers typically define windstorm by sustained wind speed thresholds or by referencing named-storm declarations from meteorological authorities. In coastal and storm-prone regions, windstorm is often carved out of standard [[Definition:Homeowners insurance | homeowners]] or [[Definition:Commercial property insurance | commercial property]] policies and written as a separate coverage or subject to a distinct [[Definition:Deductible | deductible]] structure, reflecting the concentrated [[Definition:Catastrophe risk | catastrophe risk]] it represents.

⚙️ When a windstorm event occurs, the claims process hinges on distinguishing wind damage from other perils such as flood or storm surge — a distinction that frequently drives coverage disputes. Many policies apply a percentage-based deductible (often 2–5% of the insured value) specifically for windstorm or named-storm losses, rather than a flat dollar amount. [[Definition:Reinsurance | Reinsurers]] and [[Definition:Catastrophe bond | catastrophe bond]] sponsors pay close attention to windstorm modeling, relying on vendors like AIR Worldwide and RMS to simulate potential loss scenarios. [[Definition:Excess of loss reinsurance | Excess of loss]] treaties often attach at levels calibrated to windstorm return periods, and [[Definition:Insurance-linked securities (ILS) | insurance-linked securities]] frequently use windstorm as a triggering peril.

🏗️ The financial weight of windstorm exposure shapes how insurers allocate capital, price risk, and structure their [[Definition:Reinsurance program | reinsurance programs]]. After major windstorm seasons — such as the 2004–2005 Atlantic hurricane cycles or the 2017 trifecta of Harvey, Irma, and Maria — the market has repeatedly seen capacity contractions, rate hardening, and revisions to [[Definition:Catastrophe model | catastrophe models]]. For [[Definition:Policyholder | policyholders]] in exposed geographies, windstorm coverage availability and affordability are existential concerns, sometimes requiring intervention through state-backed [[Definition:Residual market | residual market]] mechanisms like wind pools. Understanding windstorm as a distinct peril is essential for anyone involved in property [[Definition:Underwriting | underwriting]], [[Definition:Claims management | claims management]], or portfolio risk analysis.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Named storm]]
* [[Definition:Catastrophe risk]]
* [[Definition:Flood insurance]]
* [[Definition:Percentage deductible]]
* [[Definition:Catastrophe model]]
* [[Definition:Residual market]]
{{Div col end}}

Definition:Windstorm - Revision history

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