European life re/insurers remain well positioned to assess and manage the growing risks of heatwaves as these become one of the continent’s deadliest climate risks, according to a recent S&P report.
Europe is warming at roughly twice the global average rate. Tens of thousands of additional deaths recorded during recent heatwaves reflect a broader and persistent increase in heat-related excess mortality.
The health impact fell disproportionately on elderly people, as extreme heat exacerbates underlying conditions, such as cardiovascular diseases and dehydration.
During a single late-June heatwave, more than 9,000 of the 10,650 excess deaths recorded were among those aged 65 and over, according to the report.
Between 2004 and 2024, the share of people aged 65 and over in the EU increased to 21.6% from 16.4%, while the proportion of those aged 80 and over rose to 6.1% from 3.8%.
Over the same period, the share of young people reduced, with the proportion of those under 19 declining to 20.0% from 22.4% and the share of those under 15 decreasing to 14.6% from 16.2%.
The increasing share of elderly people–who are particularly vulnerable to heat stress suggests that heat-related mortality in Europe is likely to rise, S&P analysts highlight.
“We estimate that the effects of this summer’s heatwaves–including excess mortality and the deterioration of existing health conditions–affect European re/insurers’ financials, but not to an extent that would affect ratings,” S&P Global Ratings credit analyst Volker Kudszus said.
However, credit pressure could increase over the medium to long term as extreme temperature events become more frequent and intense alongside demographic ageing.
S&P stated it will continue to monitor heat-related impacts on the performance of rated re/insurers. Overall, S&P believes that European life re/insurers are well positioned to assess and manage these risks.
Kudszus concluded: “We expect that insurers will develop action plans over the next few years and that they will contribute to overall resilience measures by supporting loss-prevention initiatives and raising policyholders’ awareness of heat-related health risks.”
