Insurers Urged to Improve Lightning Claims Reporting and Mitigation

Lightning strikes cost U.S. homeowners over $1 billion annually, but the financial impact on commercial properties remains underreported and poorly understood. The main reason? Lightning-related fires are often lumped into general fire loss categories on inspection reports and in insurance claims, obscuring the true exposure for businesses and carriers.

This data gap presents a real challenge for insurance claims professionals tasked with evaluating fire-related damages. In jurisdictions where inspection forms lack fields for lightning or inspectors lack training, the cause often goes unidentified, leading to skewed data and missed opportunities for risk mitigation.

For insurers, this gap hinders accurate underwriting and impedes efforts to reduce claims severity. The article argues that insurers can lead by working with fire services to improve reporting practices and by recognizing the value of properly installed lightning protection systems (LPS). These systems, which go far beyond simple rods and cables, include surge protection, grounding, and bonding to manage both direct and indirect lightning impacts.

Notable commercial loss examples—a $1 million strike on a furniture plant and a $50 million loss at an apartment complex—underscore the scale of risk. Claims professionals should note that these losses often extend beyond structural damage to include inventory loss, business interruption, and displaced tenants. Without accurate classification, this risk remains hidden.

Improving claims tracking for lightning damage, incentivizing standards-based mitigation, and collaborating across sectors are key steps to more accurate assessments, safer buildings, and fewer large-scale commercial losses. For adjusters, understanding and recognizing the role of LPS in both claims evaluation and loss prevention is increasingly vital.