Catastrophe risk management specialist Risk Management Solutions (RMS) has released a 10-year retrospective report on the Ice Storm that devastated Ontario and Quebec and part of the northeastern US in 1998.

Despite the positive advances made in the affected region since that time, a recurrence of the ice storm would result in total insurance losses of between $1 billion and $3 billion — potentially more than twice the $1.3 billion cost incurred in 1998.

This storm demonstrates that direct physical damage from a catastrophic event may comprise only a minor percentage of the total insured losses, said Robert Muir-Wood, chief research officer at RMS. Infrastructure disruptions such as power outages lead to costly business interruption losses for commercial and industrial properties, as well as additional living expenses for homeowners forced to evacuate their freezing homes.

From January 4 to January 10, 1998, a series of storms produced large amounts of freezing rain from northern New York State through the St. Lawrence River Valley region, with some locations receiving close to four inches. Although freezing rain is not uncommon in these regions during the winter months, the 1998 Ice Storm was unique in its long duration, large geographical extent, and extraordinary freezing rain precipitation totals.

Causing considerable damage, widespread power outages, and 45 fatalities, the event is widely acknowledged to be Canada's costliest natural disaster and the most severe ice storm to hit the region since at least the 1920s.