Property claims glossary
What is a CAT event in insurance?
A CAT event is a catastrophe, such as a hurricane, hailstorm or wildfire, that produces a surge of claims across a region in a short window. It matters because every one of those claims is owed the same careful coverage review and the same state timelines, usually with far more files per adjuster.
Worked example · fictitious claim
A team that normally handles 400 claims a month receives 3,000 in the two weeks after a hailstorm. At an average of $15,000 per claim, that is $15,000 × 3,000 = $45,000,000 in expected payments. An average overpayment of just $500 per claim would add $500 × 3,000 = $1,500,000.
How it affects a settlement
A CAT event often brings special deductibles into play, such as hurricane or wind/hail percentage deductibles, and sometimes state emergency orders that change deadlines. The surge itself is when payment delays and inconsistent decisions are most likely.
In practice
A catastrophe (hurricane, hailstorm, wildfire) that produces a surge of claims in a short window. CAT volume is the stress test of a claims operation: the same coverage rigor is owed on a multiple of the usual files, with the same headcount and regulatory clock.
Related
Independent adjuster (IA) · Wind/hail deductible · Catastrophe claims surge · property claims glossary