PERILS AG, the Swiss headquartered provider of industry-wide European catastrophe exposure, industry loss data and indices, has released its first estimate for the 2014/15 season, with an estimate of €328m for European windstorms Elon-Felix.
Typically PERILS would only report on a single storm at a time, but the two low pressure storm systems that make up Elon-Felix occurred so close together that the losses are difficult to separate, meaning that PERILS reports on them as a single European windstorm event.
Elon-Felix affected Western and Northern Europe from 8th to 11th January 2015 and the storm is also known as Dagmar-Egon in Denmark and Sweden, and as Nina in Norway.
PERILS’ initial estimate of the insured industry-wide property market loss for Elon-Felix is €328m, with the majority of the insurance losses occurring in the countries of Denmark, Germany, Norway, Sweden and the United Kingdom.
Luzi Hitz, CEO of PERILS, commented on the storms; “Elon-Felix is the first event of the European winterstorm season 2014/2015 which exceeds the PERILS loss capturing trigger of EUR 200m. It was followed by windstorm Hermann (14-16 January 2015) which did not exceed the EUR200m loss threshold. The main characteristics of Elon-Felix were the rapid succession of two low-pressure systems, generating strong winds which affected almost identical areas within 24 hours. As a result, the allocation of particular losses to an individual named depression system is in some cases unclear and the event loss is therefore reported on a combined basis.”
PERILS explains the need to report on the two windstorms together:
Elon-Felix consisted of two low-pressure systems which occurred within 24 hours of each other and followed a very similar track. A clear allocation of the insured losses to either of the named systems is therefore in some instances not possible and as a result the event loss figure is provided on a combined basis.
Given the level of losses from Elon-Felix are well below the billion Euros mark, reporting on the storms together, or alone, will not affect or trouble any catastrophe bond or industry loss warranty (ILW) transactions that use PERILS for catastrophe loss reporting.
The insurance market loss estimate from PERILS is based on ultimate gross loss data as reported by primary insurance companies but excludes losses indemnified by government schemes. In line with the PERILS reporting schedule, the next and updated estimate of the insured losses from Elon-Felix will be published by 8th April 2015, three months after the event start date.
As you can see from the wind-speed value map below, had Elon-Felix moved further south the impact and insured loss could have been much higher.
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