The insurance and reinsurance industry loss estimate for the combined market-wide impacts of European windstorms Dragi and Eberhard has now been reduced to EUR 772 million (US $850m) by PERILS AG, down from its last estimate of EUR 798 million.
The two European windstorms struck on March 9th and 10th 2019, leading PERILS to at first estimate an industry wide loss of EUR 740 million in April, a figure which was raised to EUR 798 million in June.
PERILS estimates are based on industry loss data collected from insurance firms operating in the regions affected.
Dragi had been the weaker of the two low pressure storm systems that tracked across Europe, striking on 9th March 2019, immediately followed by Eberhard on 10th March, with each affecting a similar area across the British Isles, France, the Benelux states, Germany and Switzerland.
Initial estimates had suggested a much higher toll from the more powerful storm Eberhard, with a modelled loss estimate suggesting up to EUR 1.5 billion from AIR Worldwide, while Eberhard was also estimated to have caused as much as EUR 600 million of insured property damage in Germany alone by actuaries at the time.
That left the market anticipating a combined impact of over EUR 1 billion, which at the time was close to US $1.15 billion, from these two storms, which could have had the potential to affect certain reinsurance contracts or at least eat into aggregate layer retentions.
PERILS loss estimate figure combines the impacts from both events, given the difficulties in allocating specific insured losses to storm systems that occurred so close together.
Now, the latest loss estimate at a reduced EUR 772 million remains significantly below where market expectations for the impact of these storms had landed, suggesting a misinterpretation of the models and exposure data at the time of the event perhaps.
The combined impact of these storms remains the largest European windstorm loss to the insurance and reinsurance industry of the past season, reflecting a relatively benign loss experience during the period for European insurers and their reinsurers.