DUBLIN, Aug. 10, 2026 – Aon plc (NYSE: AON), a leading global professional services firm, announced the release of a new analysis showing that roof actual cash value (ACV) endorsements can reduce average severe convective storm (SCS) claim costs by approximately 30%, helping U.S. homeowners insurers manage rising loss costs while supporting more affordable coverage in storm-exposed regions.

Aon’s study, Aligning Risk and Reality: Reflecting Roof Actual Cash Value in Severe Convective Storm Risk for Homeowners, examines claims data from seven regional insurers across 77 key SCS events over the past five years, comparing otherwise similar policies with and without roof ACV terms to quantify the impact on residential losses.

The study found that roof ACV can help make insurance more affordable for policyholders, with a review of 29 public rate filings in SCS-exposed states showing premium credits of up to approximately 38% for roofs at the end of their lifespan. Carriers use roof ACV to support rate adequacy while offering lower premiums in exchange for greater roof loss cost sharing.

“Insurers are on the front line of severe convective storm volatility, where hail and wind losses can quickly pressure their profitability and constrain growth,” said Steve Hofmann, CEO Americas, Reinsurance Solutions, Aon. “Aon is committed to helping this segment use better data, analytics and risk transfer strategies to improve underwriting outcomes, strengthen portfolio performance and continue growing with confidence.”

According to Aon’s 2026 Climate and Catastrophe Insight report, SCS has become the dominant driver of insured catastrophe loss in the U.S. From 2023 through 2025, insured losses totaled $164 billion, making those years the three highest insured-loss years on record for the peril. Rising losses have been driven largely by exposure growth, including expanding urban areas such as Dallas/Fort Worth, where population and housing counts have increased by nearly 50% since 2000, placing more ageing asphalt shingle roofs in the path of hail and wind events.

“Severe convective storms are now one of the defining challenges for the homeowners insurance market,” said Adam Dawson, Director of U.S. Reinsurance Catastrophe Analytics, Aon. “As losses from hail, tornadoes and straight-line winds continue to rise, insurers are increasingly focused on understanding roof vulnerability and helping policyholders reduce loss potential before an event occurs.”

Aon’s study also identifies a modelling gap for reinsurers. Most commercially available catastrophe models assume replacement-cost coverage for residential roofs and do not differentiate policies with roof ACV endorsements. As a result, modeled SCS loss costs and probable maximum losses may be overstated, particularly for hail.

This study and previous roof analyses by Aon highlight the value of more granular roof data across underwriting, pricing, claims and portfolio management. Improved insight into roof age, roof cover and roof condition can help insurers make more informed decisions about eligibility, deductibles, limits, renewal actions and mitigation strategies.

Regular maintenance, timely repairs and a better understanding of roof vulnerability can help reduce loss potential before an event occurs. For insurers, aligning coverage design with roof condition and age can support sustainable products while helping homeowners better understand ways to strengthen resilience.

“Roof age, roof cover and roof condition can provide valuable insight into risk,” added Dawson. “When insurers incorporate those factors into underwriting and pricing decisions, they can strengthen planning, evaluate mitigation opportunities and support more stable insurance markets over time.”

Aon helps insurers and reinsurers understand evolving property risks through catastrophe modeling, actuarial analytics, claims intelligence, risk engineering and reinsurance advisory capabilities. By connecting roof-level vulnerability with portfolio-level exposure, organizations can make more informed decisions about risk transfer and capital allocation.

The full article is available here: Aligning Risk and Reality: Reflecting Roof Actual Cash Value in Severe Convective Storm Risk for Homeowners.

Click here for Aon’s Global Catastrophe Recap: First Half of 2026 report: Global Catastrophe Recap: First Half of 2026.

ENDS

About Aon

Aon plc (NYSE: AON) exists to shape decisions for the better — to protect and enrich the lives of people around the world. Through actionable analytic insight, globally integrated Risk Capital and Human Capital expertise, and locally relevant solutions, our colleagues provide clients in over 120 countries with the clarity and confidence to make better risk and people decisions that help protect and grow their businesses.

Follow Aon on LinkedIn, X, Facebook and Instagram. Stay up-to-date by visiting Aon’s newsroom and sign up for news alerts here.

Aon UK Limited is authorised and regulated by the Financial Conduct Authority for the provision of regulated products and services in the UK. Registered in England and Wales. Registered number: 00210725. Registered Office: The Aon Centre, The Leadenhall Building, 122 Leadenhall Street, London EC3V 4AN. Tel: 020 7623 5500. FP #13243 has been approved until August 7^th, 2028, after which time the content should not be used or distributed.

Media Contact

Andrew Wragg
+44 (0) 7595 217168
Andrew.wragg@aon.com