Storm Babet-Aline to cost insurers €509m, estimates Perils

Insured losses from storm Babet-Aline, which caused high winds and flooding in the UK and northwestern Europe in October, have been estimated at €509m, according to an initial assessment by catastrophe insurance data expert Perils. The majority of the storm’s losses are expected to be picked up by UK insurers, where the damage bill is estimated at £329m (€383m).

The Babet-Aline storms were caused by two low-pressure systems that became stationary after they were blocked by a high-pressure system over Scandinavia, which led to an unusually long period of intense weather over the UK and parts of northern Europe. Perils said low-pressure systems were also unusual for moving south to north, rather than the more common track west to east for autumn storms.

Luzi Hitz, product manager at Perils, said the unusual patterns seen in Storm Babet could become more familiar in a changing climate.

“Storm Babet brought record rain falls across eastern Scotland and record storm surge levels along the Baltic coastlines of Denmark and Germany. These extreme conditions resulted primarily from the easterly wind direction and Babet’s unusual storm track, extending from Portugal over the Bay of Biscay to the UK, with unseasonably warm air crossing unseasonably warm seas, leading to increased moisture content and extreme rainfall over the British Isles.

“It is increasingly likely that in a warming climate, such unusual weather phenomena will become more common.”

Perils said the event is “complex” for insurers, with the majority of the loss in the UK and Ireland due to flooding and with limited wind-related losses. However, in Germany flood insurance is optional, with lower insurance penetration, and in Demark flood losses are covered by a government scheme.

“As a result, flood and wind losses were roughly equal,” Perils said. “Despite this complex coverage landscape, as the clear majority of the Babet-Aline industry loss is related to flood damage, Perils has classified it as a flood event,” it added.

Perils said it will update the estimated loss, which covers property damage, in January 2024.