Nearly two years ago, a report issued by British insurer Lloyd’s of London painted a terrifying picture of what might happen along the U.S. East Coast if a massive solar storm knocked out the electrical grid.
The report estimated a severe storm could result in power outages not just lasting a few days or weeks - but potentially for months - along the I-95 corridor stretching from Washington D.C. through Pennsylvania and up to New York City. Such a cataclysmic solar storm could potentially knock out the grid that feeds the homes of upwards of 40 million people.
Earlier this week, a smaller, but signficant solar storm, hit the planet with a strong geomagnetic jolt that threatened these electrical grids, GPS tracking and even temporarily moved the northern lights farther south, government officials said. In a story on ABC affiliate WMUR-TV , no major damage was reported from the event.
While the chance of these storms affecting your home or business is small, the risks are there. Would your insurance cover damage to your property? What about loss to your business?
Experts predict that the probability of a powerful solar storm striking Earth in the next decade is small, but not negligible. An event large enough to damage electrical grids is predicted at being greater than 1 in 10, according to solar scientists attributed in a 2014 Reuters article.
Solar storms result from sunspots. As these sunspots send plumes of radiation, called solar flares, into space, the result can be an interaction with the Earth’s magnetic field. As an article in yesterday’s Boston Globe explains, the particles not only interrupt electrical transmission but they can wreak havoc with radio communications, global positioning systems and your personal electronics too.
A basic policy (called an HO-1 in the insurance industry) covers the big ones, including fire, lighting, windstorm (unless you live in a hurricane zone), vandalism and even volcanic eruptions. From there, you can upgrade your coverage to an HO-2, which covers more perils including falling objects, weight of ice, snow, or sleet, and even damage to electrical parts caused by artificially generated electric currents, such as a power surge not caused by lightning). The most complete form of homeowners is called an HO-3, which covers everything but items specifically listed, such as floods, earthquakes, nuclear accidents, and sinkholes. Some of these perils, like flood and earthquake insurance, are available by buying a separate policy.
While most homeowners policies don’t list solar storms specifically as being covered, damage would most likely be covered as a natural event under your insurance policy such as a lightning strike or hurricane, according to insurance agents polled by InsuraMatch staff. However, insurance carriers may differ so you should check your policy and consult with an agent to understand if such an event, or other types of natural events you’re curious about, are covered.
Loretta Worters of the Insurance Information Institute told InsuraMatch that homeowners would also have to deal with other repurcussions, including food spoilage (generally covered for up to $500).
"Insurance pays for the cost of temporarily relocating if your home is damaged by a "covered loss," such as a fire, and is uninhabitable while repairs are made," she said. "Generally a standard policy will not pay for a hotel stay simply because the power was out, even if there is no air conditioning in the summer or heat in the winter."
But perhaps the bigger question is would insurance companies be able to respond to a claim (or if you could even make one) if a cataclysmic solar flare knocked out the grid for weeks, months, or (in a worst-case scenario) years?
The most damaging solar storm to strike the Earth in recorded history occurred on Sept. 1, 1859. Named after English astronomer Richard Carrington who noted the phenomena, the “Carrington Event” as it’s now called, heavily damaged telegraph systems installed across North America Europe. Had the Carrington Event occurred during the electrical age, the disruption could have been much greater, scientists say.
Since that time, there have been other less severe but still damaging solar storms. In 1989, the effects of one such storm damaged Quebec’s power grid and eventually led to the Canadian government allocating $1.2 billion to harden the grid in that province, U.S. News reports.
Fortunately, the planet avoided a near miss recently when an enormous eruption took place on the surface of the sun on July 23, 2012. The storm was so strong that scientists said it would have been the most powerful occurrence in four centuries. Had the solar storm occurred just a week earlier, Earth would have been directly in the crosshairs, experts reported.
Critics say that most power grids are woefully unprepared to handle a major event. In a 2008 report published by the U.S. National Academy of Sciences, it predicted that a moderately severe geomagnetic storm aimed at the United States could turn off the lights and power for upwards to 130 million people and damage more than 350 high-voltage transformers, which would take months to replace. They added that a very severe storm could cause $1-$2 trillion in damage and take four to 10 years recover from.
“A geomagnetic storm that degrades the electric power grid would affect not only the energy sector but the transportation, communications, banking, and finance sectors, as well as government services and emergency response capabilities,” the report states.
In response to these concerns, many governments and electrical companies have begun debate and making moves to harden the nation’s electrical grid infrastructure from solar storms and other man-made attacks from an electromagnetic pulse that could take down, or severely interrupt, electrical transmissions. One former CIA officer told Congress last year that the nation needs to move forward, according to a National Journal article.