The extreme flooding event in Western Europe in mid-July generated the largest insurance industry loss figure so far this year – at current estimates of US$11.0 billion, according to CRESTA, the insurance industry organization that provides a global standard for risk aggregation zones and catastrophe industry losses.
June’s severe convective storms in Europe generated the second highest insured loss event so far this year, with an industry loss of US$5.1 billion, said CLIX*. This was followed by the Fukushima earthquake in Japan in February 2021, with an industry loss of US$2.5 billion.
While the weather patterns are not directly comparable, it is striking that three of these events are linked to bursts of extreme precipitation during the summer months which caused devasting flooding and hail, said a statement issued by CLIX.
This is in line with climate-related model forecasts, which indicate an increase in severity and frequency of extreme precipitation events resulting from higher temperatures and increased water-holding capacity in the atmosphere, added CLIX.
Coupled with the growth in insured assets, this ever-changing risk landscape creates a formidable challenge for the insurance industry, it continued.
The European floods occurred on July 12-18 and mainly affected Germany, Belgium, the Netherlands and Luxembourg. Austria, France, Switzerland and the United Kingdom were also affected, but to a much lesser extent. Unlike in previous major flood events in Europe (2002, 2013), which were dominated by slow-moving flood waves running downstream along major rivers, the 2021 floods were characterized by bursts of devastating flash flooding in small- and medium-scale river catchments. The floods caused extensive property and infrastructure damage and resulted in at least 240 deaths.
*CLIX is a service provided by CRESTA and offers benchmark information on natural catastrophe losses incurred by the global insurance industry.