Jörg Asmussen, General Manager of the German Insurance Association (GDV) has said that it is now expecting insurance and reinsurance industry losses of around €7 billion (USD 8.3 billion) for the July flooding that devastated parts of the country.
The new estimate from the GDV comes as the extent of the damage becomes increasingly clear, and is up on the previous insured loss estimate of €4.5 billion to €5.5 billion for the country.
“The dimensions of this extreme event only become apparent as claims are recorded and settled,” said Asmussen.
Roughly €6.5 billion of the total is attributable to claims for residential buildings, household items and businesses, with approximately €450 million related to motor vehicles.
Currently, insurers in the country are assuming roughly 250,000 claims, of which around 200,000 relate to houses, household effects and businesses, and up to 50,000 on motor vehicles.
Over July 13th to 18th, major flooding impacted parts of Central and Western Europe, including Belgium, the Netherlands, and Switzerland, although Germany remains the worst affected region.
Also known as storm “Bernd”, the event is the most damaging natural disaster in history in Germany, with severe flooding and damage seen in Rhineland-Palatinate and North Rhine-Westphalia, but also in Bavaria and Saxony.
“Together with the high hail damage in early summer, it is becoming apparent that 2021 will be one of the most expensive natural hazard years ever for insurers,” said Asmussen.
According to the GDV, the overall storm damage is far greater than the current insured loss estimate, as many buildings are not protected against all natural hazards. In fact, while almost all residential buildings in the country are protected against storms and hail, less than 50% have cover against other perils such as heavy rain and floods.
“Together with our member companies, we will be presenting ideas by autumn on how the spread of natural hazard insurance can be significantly increased at risk-adjusted prices,” said Asmussen.
Following this announcement from the GDV, it’s likely that catastrophe risk modellers will return with updated estimates soon.
RMS said in late July that the event would drive losses of up to €5.5 billion across Europe and just €3.5 billion to €4.5 billion in Germany alone.