Flooding, wind and hail storms expected to cost Germany’s insurance industry $7 billion euros

Germany’s insurance trade body has cautioned that prevention is more important than ever in the wake of flooding, hail and storm damage during 2013 that is expected to cost the country’s insurance industry almost 7 billion euros.

Rarely does damage of such dimensions occur in so short a timeframe, notes a press release issued Monday by Gesamtverband der Deutschen (GDV). The accumulation of extreme weather of different types within a few months made 2013 an exceptional year, GDV president Alexander Erdland suggested.

The estimated 2013 losses include 5.5 billion euros in property insurance claims: approximately 1.8 billion euros for the June flooding; 3.1 billion euros for hailstorms; 300 million to 400 million for windstorm Christian in late October; and 100 million to 200 million euros for winter storm Xaver in early December. Motor insurance claims related to the flooding, hailstorms and windstorms is estimated at 1.5 billion euros, the statement adds.

However, 2013 was not unique when it comes to insurer costs flowing from natural disasters. There have been comparable years – for example, 1990 with storms Wiebke and Vivian, and 2002 with the Elbe flood and winter storm Jeanette – and the GDV suggests more such years are expected.

The GDV reports a joint study by insurers and climate scientists indicates an increase in weather-related catastrophes. More specifically, the statement notes, flood frequency could double and storm-related damage could increase by more than 50% by 2100, while hail damage could rise 60% by 2050.

The events of 2013 have clearly shown information and prevention are more important than ever, the GDV reports. Preventive measures are needed and public awareness of associated risks must be strengthened.