Insurance industry hit hard by Central Europe floods

Record-breaking floods leave billions in damages across Europe

Insurance industry hit hard by Central Europe floods

Catastrophe & Flood

By Jonalyn Cueto

PERILS has updated its loss estimate for the catastrophic floods that struck Central Europe and Italy between September 14 and 20, 2024. According to the report, the revised industry-wide loss estimate now stands at €2.080 million, an increase from the initial estimate of €1.886 million released on November 4, 2024.

The severe flooding primarily impacted Austria, the Czech Republic, and Poland, while Italy and Slovakia also suffered significant damages. The floods were triggered by low-pressure system Boris (also known as Anett), which followed a typical Vb track from the Mediterranean toward Central Europe. The system brought heavy and prolonged rainfall, with excessive precipitation linked to record-high sea surface temperatures in the Mediterranean, contributing to elevated atmospheric water content.

The updated loss figure combines two methodologies: the traditional PERILS CORE approach, which aggregates insurer-provided data, and the extended CRESTA CLIX model, which incorporates insights from a range of industry sources. PERILS noted this dual-method approach will become a global standard for PERILS starting January 2025, covering non-US regions with detailed country-level catastrophe data.

Broader impacts

Christoph Oehy, CEO of PERILS, underscored the escalating challenges posed by extreme weather events. “Europe has, to date, experienced three flood events in 2024 which have generated major losses for the insurance industry. These include the floods in southern Germany in June, in Central Europe in September, and most recently in the Valenica region of Spain in October,” he said. “Together these events have caused industry losses of more than €7 billion, a figure only topped by the Bernd floods of July 2021, and clearly demonstrate the increasingly critical role of the European insurance industry in recovery efforts following major flood disasters.”

The Boris system deviated from typical storm patterns, looping back toward central Italy, further exacerbating flooding conditions. According to PERILS, these unprecedented events highlight the role of the insurance industry in facilitating recovery efforts and emphasise the growing need for comprehensive data to mitigate risks and aid in disaster response.

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