Munich Re: Floods Dominate European Cat Losses in 2013

Munich ReMunich Re said initial estimates show natural catastrophe losses totaled 17 billion euros (US$23.3 billion) in Europe for the first nine months of 2013, with floods dominating the loss totals.

Source: Source: A.M. Best | Published on October 22, 2013

Munich Re Q1 profits 2024

Flood losses accounted for 75% of European catastrophe losses in 2013, the reinsurer said.

According to Munich Re, the long-term trend in the number of natural catastrophe events and the resulting losses "is clearly pointing upwards," as an analysis of Munich Re's natural hazards statistics confirms that severe weather events have almost tripled worldwide since 1980, where flood events in Germany and Central Europe have doubled.

"It is urgently necessary to adapt to such events now," said Ludger Arnoldussen, a member of Munich Re's Board of Management, in a statement. "Studies clearly show that it makes far more economic sense for economies to invest in prevention early on and thus avoid losses."

Flooding in southern and eastern Germany and neighboring states in May and June 2013, resulting in an economic loss of more than 12 billion euros, has been the biggest loss event in Europe so far this year, said Munich Re.

Regarding upcoming treaty renewal negotiations in reinsurance as reinsurers conclude treaty negotiations at Baden-Baden, Munich Re said it expects prices for business in its own portfolio to remain largely stable. "Special circumstances apply to the German market, where the high claims burden from natural hazard events in the current year will play a major role in the renewal discussions," the reinsurer said.

Catastrophe capital is one of the biggest issues occupying reinsurers at the annual Baden Baden reinsurance negotiations in Germany Oct. 20-24 this year.

Estimated losses from one of the most recent events in Europe --- hailstorm Andreas, which hit Germany in July --- are at least 2.5 billion euros, according to Hannover Re. The company put its own net loss from the storm at 64 million euros.

German insurer Talanx AG, which holds a significant stake in Hannover Re, has estimated its pretax net losses from Andreas at about 130 million euros. This figure, Talanx said, includes Hannover Re's loss.