German reinsurer Deutsche Rückversicherung AG (Deutsche Rück) has said that it is expecting only a “moderate” net loss of €40 million to €50 million from Storm Bernd, which brought catastrophic flooding to Germany last month.
The storm is expected to drive overall economic losses of over $10 billion, with insured losses of roughly €5 billion in Germany alone, after impacting large swathes of Western and Central Europe I July.
Deutsche Rück estimates its own gross loss at between €180 million and €230 million, but says that its retrocession program should absorb the majority of these costs.
“Based on initial claims and our own modelling, as one of the largest reinsurers on the German market we are taking a corresponding hit from the effects of storm Bernd,” said Deutsche Rück CEO Frank Schaar.
“Thanks to our retrocession structure, which is tailor-made for such events, we expect a net loss of 40 to 50 million euros after relief from our reinsurance cover,” he added.
Reinsurance industry losses following the German floods are expected to be significant, with Generali already having confirmed that it will tap its reinsurance cover following Bernd, which should cap the insurers losses at around €100 million.
And other major insurers have also stated that they face large exposures to the flooding, although it remains to be seen how exactly reinsurance coverage will fit into the picture in these cases.
AXA, for instance, said alongside its Q2 results yesterday that the preliminary claims estimate from the floods is €400 million, before tax and net of reinsurance.
Likewise, Allianz is anticipating a total of more than 30,000 property damage claims and 5,000 for vehicle damages, with a total claims volume of more than €500 million.
