Zurich-based catastrophe insurance data provider PERILS has released its fourth and final insurance industry loss estimate for the floods that struck Central Europe and Italy between September 14 and 20, 2024, totalling €2.153 billion.
The final figure compares with PERILS’ earlier loss estimates of €2.192 billion, €2.080 billion, and €1.886 billion, published six weeks, three months, and six months after the event, respectively.
PERILS recalled that in mid-September 2024, the low-pressure system Boris (also known as Anett) brought prolonged heavy rainfall across large parts of Central Europe, triggering flooding in the Danube, Elbe, Oder, and Vistula river basins.
According to the catastrophe insurance data provider, the majority of the losses occurred in Austria, the Czech Republic and Poland, with Italy and Slovakia also impacted. In total, an estimated 30,000 people were evacuated, and 29 people died due to the floods.
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Luzi Hitz, Product Manager at PERILS, commented, “This event was remarkable in several aspects. Firstly, it was accurately predicted by weather models well in advance, allowing sufficient time for preparation.
“Secondly, very early market loss estimates during or immediately after the event, often providing loss ranges, were remarkably accurate. And thirdly, the event was efficiently handled by the insurance industry in the affected countries together with their reinsurance partners.”
He continued, “Nevertheless, as with every major Cat event, there are lessons to be learned. For example, there is the need to tackle outdated policy conditions resulting in under-insurance.
“Moreover, non-insurance of the flood peril in general means a significant portion of the overall economic loss, which we estimate at €7.6 billion, remained uninsured.”
PERILS observed that this final figure is based on the combination of the PERILS CORE methodology, which involves the grossing up of loss data provided by affected insurers to 100% market level, and the PERILS EXTENDED methodology, which is based on expert evaluation of a broad range of insurance industry sources.
Christoph Oehy, CEO of PERILS, said, “This event provides an excellent example of the advantages of combining PERILS CORE and PERILS EXTENDED, which has been well received by the risk transfer market.
“Already, we have seen numerous industry-loss transactions carried out using PERILS CORE and/or PERILS EXTENDED as the protection trigger, including earthquake Japan and Chile, as well as windstorm Europe, including CEE countries. This rapid adoption provides further motivation to continue listening to market needs and responding accordingly.”
Story was adapted from Reinsurance News.
