140-MPH Tornado Strikes Before Warning, Exposing Costly Coverage Gaps

A 140-mile-per-hour EF3 tornado tore through northeastern Wisconsin before the first tornado warning was issued, damaging homes, uprooting trees, and knocking out power to thousands. The July 27 storm is a stark example of how quickly severe weather can strike — and why homeowners should understand how their Residential Property Insurance will respond before the next storm hits.

The first tornado warning sounded in the towns of Menasha and Appleton at 11:59 a.m., approximately three minutes after the storm hit, CNN reported. The 140-mph winds caused what the Menasha Police Department described as “severe damage in broad areas,” however no fatalities were reported.

“Anytime you have an unpredictable storm like a tornado, the first thing you think of is concern for all those affected,” said Kate Wright, Vice President, Senior Regional Practice Group Leader, Burns & Wilcox, Indianapolis, Indiana. “Aside from the property damage, there is the overall effect on life. It is awful.”

Homeowners who face tornado damage typically have coverage for repairs under their Homeowners Insurance, but increasingly common percentage-based Wind and Hail Deductibles and age-based roof settlement schedules can leave some homeowners paying more out of pocket than they may expect.

“I certainly think homeowners need to be taking a look at their coverage — specifically their deductibles,” said Adam Currier, Senior Underwriter, Personal Insurance, Burns & Wilcox, Indianapolis, Indiana. “It seems to be the trend for insurance companies to have higher deductibles for wind and hail events, and homeowners need to be aware of those and their options.”

Convective storm losses on the rise

In 2025, severe convective storms caused about $82 billion in global economic losses, nearly three-quarters of which occurred in the U.S., according to a recent Realtor.com report citing data from climate research firm First Street. These storms caused almost a third of all natural catastrophe losses globally last year.

“Convective storms are all-encompassing of not just tornadoes but hail, strong winds, and the ensuing water damage,” Wright explained. “They can cause significant damage — tens of thousands of dollars or more, depending on how large the home is and the severity of the storm.”

Convective storms are all-encompassing of not just tornadoes but hail, strong winds, and the ensuing water damage. They can cause significant damage — tens of thousands of dollars or more.

Roofs are often the first part of a home to sustain damage, Currier said, but windows, gutters, downspouts, and outdoor property can also be affected. Patio furniture and other unsecured items may be damaged or cause additional damage during high winds.

“It seems to be both more frequent and larger storms that are coming through and causing more damage,” he said. “Here in Indiana, specifically, we have been seeing more and more convective storm events.”

It seems to be both more frequent and larger storms that are coming through and causing more damage. Here in Indiana, specifically, we have been seeing more and more convective storm events.

As convective storm losses grow, some insurance carriers are adjusting how they address these risks. Homeowners Insurance policies today are more likely to include a separate Wind and Hail Deductible in addition to their All Other Perils Deductible, Wright said. Actual Cash Value (ACV) Coverage for older roofs or predetermined Roof Depreciation Schedules are also becoming more common, as well as limitations for hail-related roof damage that is considered purely cosmetic.

“There are a lot of different ways that insurance carriers have been responding to the increase in convective storms over the last couple of years, especially throughout the Midwest, to try to manage the risk exposure itself,” she said.

For example, a policy may provide full replacement cost for a newer roof and gradually reduce the reimbursement to a different percentage of the replacement cost as the roof ages, Currier said. “Homeowners need to be aware of that,” he said.

Buyback policy can reduce out-of-pocket costs

Severe storms accounted for eight of the 12 billion-dollar weather and climate disasters recorded in the U.S. during the first half of 2026, according to research nonprofit Climate Central. Together, those 12 events caused nearly $32 billion in damage.

When storm damage occurs, homeowners are typically responsible for either a flat deductible for wind and hail losses — such as $2,500, $5,000, or $10,000 — or a percentage of the home’s insured value, Currier said. Percentage-based deductibles can create particularly large expenses for owners of higher-value homes, making a Wind Deductible Buyback Policy a helpful option for many homeowners.

“Our Wind Deductible Buyback Policy can help buy that deductible down,” Currier said. “It is a separate policy covering the gap between the higher deductible and the lower deductible, making the amount the insured retains more palatable.”

For example, a homeowner whose $1 million property is insured with a 5% Wind and Hail Deductible would be responsible for the first $50,000 of a covered loss. A buyback policy could reduce that responsibility to 1%, or $10,000, Wright said. “They can actually reduce the burden of their out-of-pocket expense for the deductible,” she said.

Originally introduced for coastal properties in 2022, the Wind Deductible Buyback Policy was recently expanded to the Midwest in response to storm trends and greater demand.

“We just expanded to 17 inland states this month,” Wright said. “For those who are uncomfortable with really large out-of-pocket deductibles, this product is perfect because it lowers their exposure.”

For those who are uncomfortable with really large out-of-pocket deductibles, [the Wind Deductible Buyback Policy] is perfect because it lowers their exposure.

Storms can bring multiple water risks

In August, another round of severe storms swept through the Midwest, causing “catastrophic flooding” and leaving hundreds of thousands of individuals without power. In addition to the risk of flash flooding from severe convective storms, storm-related power outages can create another water risk for homeowners.

“During a severe storm, it is often a water backup issue if the power goes out and disables the sump pump,” Currier said. “If homeowners do not have a battery backup, water can back up into the basement, or there may be too much water for the sump pump to keep up with.”

Water Backup Coverage can respond when water overflows from a sump pump or drain, while Flood Insurance is designed for damage caused by rising surface water. Homeowners may need both forms of protection, Wright said.

“We continue to see an increase in demand for private Flood Insurance for homeowners, especially in areas that are not usually prone to flooding or are not considered to be in a ‘flood zone,’” she said. “An annual review of their insurance is the best-case scenario. You can compare deductibles and check whether any policy forms have changed that would impact how coverage would be applied in the event of a wind or convective storm loss.”

Homeowners may also consider loss-mitigation strategies such as roof maintenance, upgrading to more durable roofing materials, installing a battery backup for the sump pump, and securing objects that could become airborne during high winds.

As years go on, homeowners often make changes to their homes and their assets change. They need to have an annual review of their insurance coverages to make sure that they are covered adequately.

“As years go on, homeowners often make changes to their homes and their assets change,” Currier said. “They need to have an annual review of their insurance coverages to make sure that they are covered adequately.”