UK’s winter 2020 floods & storms cost re/insurers almost US $1.1bn: PERILS

Winter 2020 severe windstorms and flooding events cost insurance and reinsurance interests in the United Kingdom almost US $1.1 billion, according to the latest data from PERILS AG.

The Zurich-based provider of estimates for insurance and reinsurance market property losses has updated its estimate of industry losses from the flooding that struck the United Kingdom in February 2020 to UK £368 million, a reduction from its previous estimate of UK £375 million.

The flooding covered by this loss estimate began with named European windstorms Ciara (Sabine) and continued with windstorms Dennis and Jorge as well.

At least 4,800 properties were estimated to have been damaged by the February UK floods. However flood defences saved the damage from being much more widespread, which could have driven a significantly larger insurance and reinsurance market loss.

The UK’s winter 2020 flooding began in November 2019, when large areas of northern England flooded. It continued into early 2020 as well, with flood incidents seen in December and January, before the peak of the winter floods began with storm Ciara in early February.

Dalida Bachmann, Head of Client Relationships at PERILS, said, “While the industry loss from the February 2020 Floods was not exceptional per se, it contributed to other weather-related losses experienced during the winter 2019/2020. We estimate that the floods in November and December 2019 and wind-related losses from storms Ciara, Dennis and Jorge in February 2020 have cost the UK insurance industry approximately GBP 410 million.

“Adding this amount to the GBP 368 million loss figure for the February 2020 floods, the resulting total industry loss figure from both wind and flood during the 2019/2020 UK winter is approximately GBP 778 million. This is in sharp contrast to the current winter 2020/2021 during which no windstorm or flood event has exceeded the PERILS loss capturing threshold of EUR 200 million to date.”

The UK £778 million aggregated industry impact converts to roughly US $1.1 billion at this time.

These losses aren’t significant in the industry experience though, as the UK saw much higher flood related losses in December 2015, at around UK £1.1 billion and in June/July 2007 when the industry loss at the time reached around UK £3 billion.