Aon sees European storms as costliest ever, US $4.5bn+ industry loss

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Recent severe thunderstorms, convective weather, rainfall, flooding and a tornado that impacted Europe in June is expected to aggregate to at least a US $4.5 billion insurance and reinsurance market loss, making it the most costly episode on record.

Weather image from DreamaticoThis is according to broker Aon’s Impact Forecasting unit, who said that the severe weather that impacted Western and Central Europe from June 17th through the end of the month will generate the largest damage bill as the costliest severe storm period on record for Europe.

Severe convective weather, thunderstorms and in particular hail storms have become increasing contributors to insurance and reinsurance losses in Europe, in recent years perhaps generating similar losses on aggregate as the winter windstorm season.

We’d previously reported soon after the event that an actuarial group estimated the storms cost at least EUR 2.5bn.

Aon’s Impact Forecasting breaks the severe storms into two specific periods of weather.

First, an outbreak from June 17-25 that mostly impacted the Czech Republic, Germany, France, Switzerland and Austria.

This outbreak included the powerful F4 tornado that caused devastating impacts in the Czech region of South Moravia.

Widespread hail, wind and flood damage impacted many other parts of Europe, with the total insurance market impact expected to exceed US $3.4 billion, with economic losses reaching even higher.

Severe weather returned to Central Europe on June 28-30, as large hail caused damage in central Switzerland and Austria, while many parts of Germany experienced flooding.

Total aggregated insurance impacts from the severe convective storms outbreaks between June 17 and 30 represent “the costliest stretch of severe weather in European history and fifth costliest globally, with combined losses preliminarily estimated by the national insurance sectors at $4.5 billion, surpassing the previous European record of $4.3 billion set by storm Andreas in 2013,” Impact Forecasting explained.

Insurance companies in Austria, Switzerland and the Czech Republic recorded their costliest stretches of severe weather on record, while Germany experienced the second costliest, the company also noted.

Michal Lörinc, senior catastrophe analyst for Aon’s Impact Forecasting team, commented, “While the United States generates most headlines given the frequency and aggregated high financial costs associated with severe thunderstorm outbreaks, other parts of the world are also prone to such events.

“The extended stretch of severe weather in the second half of June across Western and Central Europe featured very large hail, flash floods, and one of the most intense tornadoes recorded in the recent European record. Multi-billion-dollar insured thunderstorm outbreaks are not regularly common in Europe, but they can and do happen.”

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