European storm losses converge between €3bn and €5bn with Eunice most costly for 15 years

Insured losses from recent European storm losses are settling in the €3bn to €5bn range, after two more estimates came out from RMS And Verisk.

RMS has now estimated insured losses from windstorms Dudley and Eunice, also known as Ylenia and Zeynep, at between €3bn and €4.5bn.

On the same day, Verisk placed losses between €3bn and €5bn for the two storms.

An earlier estimate from Fitch agreed that the storms plus Franklin, which hit a day or so later, could cost the insurance industry up to €5bn.

RMS said 40% of the total losses from its estimate will likely fall in Germany, with the Netherlands accounting for 20% and the UK next worst-hit on 15%. It said the storms will also cause losses in Ireland, France, Belgium, Denmark, Switzerland, Austria, the Czech Republic, Poland and Slovakia.

RMS’s modelling predicts that Eunice will cause between €2.5bn and €3.5bn of its combined loss estimate for the two storms.

This would place Eunice as the most costly European windstorm since Kyrill in 2007.

RMS estimate is for wind only and does not include losses from storm surge and inland flooding.

Michèle Lai, senior product manager for Europe climate models at RMS, said: “Windstorm Eunice will likely be the costliest European windstorm of the last 15 years, following the path of Kyrill (2007), however it will end up causing less damage in Germany than its ‘big brother’. Although the last two decades have mostly spared us from history-making windstorms like Daria (1990) or Lothar (1999), windstorms Dudley and Eunice remind us how destructive these events can be and highlight the significance of storm clustering, [which is] the close succession of multiple storms following similar trajectories, in Europe.”

Fitch said previously that the losses from storms Dudley, Eunice and Franklin will “dent” non-life insurers’ profits, particularly in Germany, the UK and the Netherlands.

The agency said, however, that reinsurance cover held by the primary carriers should see this bill reduced to less than €2bn. “In most cases, we do not expect the losses to burn through insurers’ earnings, materially erode capital or affect ratings,” said Fitch.