What a difference a month can make. As IAG, QBE and Suncorp lined up to deliver a succession of healthy results at the end of February, the storm clouds were already gathering.

Four weeks later, all the local insurers are left counting the cost of severe storms in Melbourne and Perth, as well as flooding and cyclone events in Queensland.

Taken together, insured losses will top $1 billion.

The March 22 hailstorm in WA is that state’s largest natural catastrophe on record. Latest figures from the Insurance Council of Australia show insurers have received more than 42,500 claims from WA customers at a cost of $203 million.

It follows the Melbourne hailstorm on March 6, which left claims now estimated at $830 million. When business interruption and other longer-term claims are factored in, the bill may be considerably larger again.

In southwest Queensland, flood-soaked policyholders had submitted 7500 claims by March 8, with estimated insured losses of $120 million. Add the growing number of claims in the aftermath of Cyclone Ului that hit the Whitsundays and Queensland central coast on March 21, and the full picture isn’t encouraging for the insurers.

“This is not small beer – it is very significant,” Ibisworld finance analyst Zlatan Kapetanovic told insuranceNEWS.com.au on Friday.

“Insurers are already operating a combined ratio of close to 100% before paying out these claims, leaving profit very much dependent on investments.”

Although general insurers are very well prepared to respond to natural catastrophe events, the industry has been forced onto the back foot by three in quick succession.

Commercial insurer CGU provided some insight in a statement it released on Thursday.

“This is the first time the insurance industry has had to manage the impact of three catastrophe events at the same time,” it said. “The significant volume of claims from all three events will cause industry-wide delays in completing damage assessments and repairs.”

For people such as Don McKenzie, the MD of claims management provider Stream Group, there are only so many hours in the day.

“When it rains, it pours,” he told insuranceNEWS.com.au last week. “We’ve been busy with the Central Queensland floods and [Cyclone] Ului, then there’s Melbourne and now we’re seeing a solid number of claims in Perth.”

As well as keeping the industry busy, the natural catastrophe events will have an unavoidable impact on the bottom line of the domestic insurers, just as results for dominant personal lines players IAG and Suncorp were beginning to return to some kind of norm.

IAG has already estimated natural peril costs will exceed by $180 million its budgeted $184 million allowance for the second half. As a consequence, the insurer has twice refined its full-year insurance margin guidance to 9.5-11% from 10.5-12% and an original figure of 11.5-13%.

“While the vagaries of the weather have again forced us to refine our full-year guidance, I continue to be confident that the fundamentals and underlying performance of our business remain strong,” CEO Mike Wilkins said on Friday.

Mr Kapetanovic says insurers’ combined ratio could climb to 99.7% in the wake of the catastrophe events while profit margins may decline to as low as 5%.

Morningstar analyst David Walker says the effect on IAG’s margin highlights the considerable exposure both IAG and Suncorp face on the domestic front, despite the existence of reinsurance which has helped to mitigate a significant portion of costs.

While the Melbourne event saw IAG and Suncorp reach maximum reinsurance event retention caps of $135 million and $200 million respectively, Mr Walker says QBE’s exposure is likely to fall below its allowances.

Of the other “big five” local insurers, Allianz Australia last week announced a $58 million exposure in Melbourne, a $17 million bill in Perth, and $3.5 million exposure attributable to Ului. All those figures are expected to rise, perhaps significantly.

Zurich Australia doesn’t expect the events to make much of a dent into its profitability, reporting only modest losses in its commercially focused portfolio.

Now it’s the turn of RAC Insurance in WA to cop the brunt of this country’s famously volatile climate. It is the largest home and car insurer in the state, with more than 600,000 policies. Already more than 15,000 claims have flooded its systems.

Given the bumpy ride endured by the major local insurers in recent years, it appears normal service has resumed.

“Australian weather is a volatile phenomenon and while it is sometimes predictable in terms of timing, March is a little bit outside the usual pattern,” Mr Walker says.

“It was a quiet period for claims in the first half of financial year 2010 and we are now back into it.”

Of that there can be little doubt.