The National Insurance Crime Bureau (NICB) ForeCASTSM report, , Metal Theft Claims from Jan. 1, 2013, through Dec. 31, 2015, analyzes copper, bronze, brass and aluminum theft claims identified in Insurance Services Office (ISO) ClaimSearch from Jan. 1, 2013 to Dec. 31, 2015, in order to identify any trends or patterns that may exist in the data.
There were a total of 35,961 claims for the theft of copper, bronze, brass or aluminum submitted to ISO ClaimSearch between Jan. 1, 2013, and Dec. 31, 2015. Of the 35,961 total claims, the vast majority (98 percent) pertained to the theft of copper. Of these claims, 58 percent were on personal policies, while 42 percent were on commercial policies. When the number of metal theft claims and copper prices are compared, a statistically significant positive correlation was revealed.
While the number of metal theft claims was increasing from 2006 through 2011, in 2012 the number of claims leveled off, and then decreased from 2013 through 2015. In general, the number of claims was seen to decrease in summer months, and increase in winter months, with spikes in claims in January and October.
Ohio was identified as the loss state with the most metal theft claims in ISO ClaimSearch, with 44 percent more claims than Pennsylvania, the state with the second largest number of claims. Ohio also had the highest rate of claims per capita. The New York-Newark-Jersey City, NY-NJ-PA Core Based Statistical Area ranked first in ISO ClaimSearch metal theft claims from 2013 through 2015.
Law enforcement agencies across the country and around the globe started seeing increased numbers of thefts of metals such as copper, bronze, brass and aluminum in the years leading up to the recent economic downturn. Copper prices were at record highs, increasing the attractiveness of the metal as a target for theft. Thieves have been willing to go to almost any length to obtain the metal. They have stripped sheets of metal from building rooftops, stolen memorial decorations from cemeteries, ripped apart air conditioners for the copper coils, and stripped homes and buildings of wiring and piping.
Construction sites are frequent victims because metal is often left onsite unguarded and relatively unsecured. The thieves can endanger the safety of themselves and those in the surrounding community, and weaken the infrastructure vital to everyday life.
Unoccupied buildings have exploded due to gas lines being stolen. Stretches of highway have been left dark and tornado warning sirens have been rendered inoperable due to wiring being stolen. Thieves have removed wiring from traffic and railway signals and even posed as utility workers in order to remove large sections of thick utility cable from the sewers beneath city streets. Electrical substations are frequently targeted and some thieves have been electrocuted trying to steal live electrical wiring.
The damage caused by such thefts is often several times the value of the metal stolen, leaving the victims with hefty repair costs, which are then often passed on to insurance companies. The U.S. Department of Energy has estimated that metal theft costs U.S. businesses around $1 billion a year. Some states and cities have taken measures to combat metal theft, such as requiring scrap yards to check identification of any individual who sells them scrap metal, note the license plate of the vehicle used to transport the metal, maintain the information on file, pay the seller with a check instead of cash, or retain the scrap metal for a designated amount of time to allow law enforcement an opportunity to identify stolen materials before it is recycled.
However, identifying stolen metal is not always possible, and opposition to these laws has made it difficult to get effective measures passed in some areas. Even in areas where such laws exist, some unscrupulous scrap dealers may not abide by them and enforcement of the laws has not always been a major priority until recent years when increases in metal thefts brought more attention to the problem. Some states and local governments have increased the penalties associated with metal theft or are charging thieves with additional crimes if the theft caused damage to infrastructure or created a hazard to the public. On the federal level, a bill was introduced to Congress in 2013 that would make certain cases of metal theft a federal crime, such as thefts that affect infrastructure, and incorporates some of the approaches just mentioned, but it has not been passed.
Metal theft Claims in ISO ClaimSearch
This report analyzes the claims identified in ISO ClaimSearch as involving the theft of copper, aluminum, brass, or bronze. ISO ClaimSearch is a database designed to help insurers, self-insurers, law enforcement agencies, and state fraud bureaus detect and prevent fraud, evaluate risk and process meritorious claims by providing a central repository of claims. Insurers and other agencies with access can query this database to research prior loss histories, identify claims patterns and detect suspect claims.
The following chart shows the number of metal theft claims that occurred per month from Jan. 1, 2013, through Dec. 31, 2015. It should be noted that there is often a delay before claims are entered into ISO ClaimSearch. Claims that occurred in 2015 and earlier, but were entered in the first quarter 2016, are included in the following chart to minimize the impact of these delays; however, some months may still be underrepresented in the data, particularly the final months.
When compared with the graph of copper prices for the same time period, a statistically significant positive correlation between metal prices and the number of metal theft claims was found to exist.
The following table, in alphabetical order by state, shows the number of claims per state for all 50 states and the District of Columbia, as well as the number of claims per 100,000 residents.