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PERILS to assess European windstorm Xaver industry loss potential


Zurich based PERILS AG, independent provider of industry-wide European catastrophe insurance loss data and indices to reinsurers and ILS specialists, told Artemis today that it will be analysing the impacts of European windstorm Xaver to assess whether it has caused a sufficient insurance industry loss to qualify for full reporting.

PERILS AG reports on and produces event insured loss information on qualifying European windstorm events which result in a market-wide insured industry property loss exceeding €200m. PERILS makes an initial investigation of a storm’s potential to cause a sufficiently large insurance industry loss as the first step in its process. If it becomes apparent that the storm will likely cause a €200m market-wide loss then it will be reported on, based on information PERILS receives from data providing insurance companies.

PERILS makes the total insured loss figures publicly available for any qualifying events while its subscribers also have access to more granular industry loss information, including by country, CRESTA Zone and occupancy type (residential property, commercial property, industrial property and agricultural property).

Dr. Eduard Held, Head of Products at PERILS, told Artemis; “PERILS is in the process of deciding whether windstorm Xaver has the potential to lead to a market-wide insured property loss of more than EUR 200m.”

If it is decided that European windstorm Xaver is likely to have caused that size of loss, or greater, it will be moved from being ‘under investigation’ to a ‘qualifying event’ at PERILS and will then enter its regular reporting cycle.

Held continued; “Should an investigation of Xaver lead to the view that the storm is likely to exceed EUR 200m in market-wide insured property losses, PERILS will capture loss data and report it according to the PERILS reporting schedule.”

The resulting loss data and indices that PERILS publishes on events are widely used by the modelling community and across the insurance-linked securities (ILS), catastrophe bond, industry loss warranty and broader reinsurance markets. The loss numbers are used as arbiters to decide whether a contract has been triggered or not.

Should windstorm Xaver qualify for reporting then the reinsurance and ILS space will watch closely as the loss figures are reported.

It’s very early days for Xaver as the windstorm is still affecting northern Europe right now. One of the main threats is storm surge, which has already caused some flooding along the UK coastline and in Germany.

PERILS includes all losses from wind and ensuing perils in its estimates, which means that storm surge will be included where it is an insurable risk. This depends on the underlying property policies, storm surge is often included in the UK, so would be included in PERILS estimate of losses, but in Germany it is generally not included in policies (with the exception of all-risk policies).

At the moment it looks as if Xaver will cause a similar sized industry loss to Christian, but with flooding a major factor that could rise and Xaver could become a larger loss if storm surges at high tides have been as impactful as expected.

We’ll update you as soon as early loss estimates for European windstorm Xaver emerge.

Earlier today we published PERILS first loss estimate for European windstorm Christian, which they have pegged at EUR994m.

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