Catastrophe risk modeller RMS has estimated that insurance industry losses from windstorms Dudley (Ylenia) and Eunice (Zeynep), which battered parts of Europe in February, will be between €3 billion and €4.5 billion.
Of this total, RMS expects storm Eunice to account for the large majority, or between €2.5 billion and €3.5 billion, ranking it as the most damaging European windstorm since Kyrill in 2007.
The windstorms caused widespread damage across parts of Europe over February 16th to 19th, with particularly severe impacts in Germany. In fact, RMS estimates that Germany will account for 40% of the total industry loss, followed by the Netherlands at approximately 20%, and the UK at roughly 15%.
The two storms also affected Ireland, France, Belgium, Denmark, Switzerland, Austria, the Czech Republic, Poland, and Slovakia.
RMS’ estimates are wind-only and are based on hazard reconstructions using the version 15.0 RMS Europe Windstorm Models. The estimates include damage to property, automobile, agriculture, and direct business interruption, but exclude losses from damage to infrastructure, which are expected to be immaterial.
The risk modeller adds that losses from storm surge and inland flooding are also excluded from its estimates, as these are also not expected to be material.
However, the loss estimates from RMS do take into account unique aspects of these events, including market dynamics and economic effects from the ongoing COVID-19 pandemic, which the firm says will likely raise losses above typical expectations.
Additionally, the loss estimates consider a marginal amount of post-event loss amplification and the possibility of “claims leakage,” the payment for damage from other events under a single occurrence, given that several events occurred in close succession. Here, RMS is referring to storm Franklin, which hit Europe to a smaller degree over February 20th – 22nd.
Michèle Lai, senior product manager for Europe Climate Models at RMS, commented: “Windstorm Eunice will likely be the costliest European windstorm of the last 15 years, following the path of Kyrill (2007), however, it will end up causing less damage in Germany than its ‘big brother.’
“Although the last two decades have mostly spared us from history-making windstorms like Daria (1990) or Lothar (1999), Windstorms Dudley and Eunice remind us how destructive these events can be and highlight the importance of storm clustering, the close succession of multiple storms following similar trajectories, in Europe.”
This estimate from RMS follows that of Verisk Extreme Event Solutions, which pegged the industry loss at between €3 billion and €5 billion. Analysts at Fitch Ratings also warned of an up to €5 billion loss from the storms, while the Dutch Association of Insurers warned that losses in the Netherlands alone would be more than €500 million.