Windstorm Christian losses up to €1.3bn

AM Best said this week that despite the windstorm losses, diversified non-life insurers in the region remain on course to post strong overall results in 2013. But it warned that local German insurers are now under some pressure as a result of heavy cat losses this year. The UK, northern France, Belgium, the Netherlands, the Nordics and northern Germany were all victims of windstorm Christian that struck from 27 to 29 October. According to Willis Re, the highest loss is likely to occur in the UK with an estimated insured figure of between €350m and €590m.hideIt estimates insured losses in Germany of between €250m and €400m. Loss estimates for Denmark are still uncertain but are preliminarily placed at €160m to €325m. In addition, the brokerage expects losses in Sweden and the rest of the Nordic region of up to €50m. The Dutch Insurance Association have a preliminary estimated €105m of insured losses in the Netherlands. This may not cover all classes of business, noted Willis. It therefore estimates a total market loss in the Netherlands of between €100m and €150m. Willis Re expects to see low insured losses in France and Belgium. Dr John Alarcon, Executive Director at Willis Re, said: "While definitely not one of the largest windstorms to have ever affected Europe, it is the largest windstorm in Europe since the 2010 loss when Windstorm Xynthia cost the industry around €1.3 billion. This storm could potentially equal Xynthia in terms of insured loss, but is unlikely to exceed it." While AM Best said in a briefing note that large European insurers are well placed to sustain the windstorm Christian losses, smaller, regionally-focused German companies may incur underwriting losses for the year from an accumulation of natural catastrophes. AM Best notes that the first five months of 2013 were largely benign in terms of European natural catastrophes. Aggregated catastrophe losses from Christian and other weather-related events remain well below most insurers' 2013 budgets, it said. However, while AM Best said companies with diverse books of business in the UK, continental Europe and the US remain well positioned to report a good year for underwriting earnings, this scenario may not apply to domestic German insurers. In addition to the recent windstorm and June flooding, hailstorms hit western and southern Germany in July and August, resulting in estimated losses of €2.7bn. Yvette Essen, Director, Industry Research - Europe and Emerging Markets at AM Best said: "For German insurers that write the majority of their business locally, with a concentration in property lines, these accumulated losses may cause companies to exceed their catastrophe budgets significantly. Depending on their level of reinsurance protection, these companies may post large underwriting losses for the year and could experience erosion in equity capital." Willis Re noted gusts from Windstorm Christian reached 159 km/h in the UK. 130 flights from Heathrow Airport were cancelled. Around 625,000 properties were without power and rail services were suspended in the south of England. There were 134 flood alerts and dozens of flood warnings across England and Wales due to rain accompanying the wind. In northern Germany peak gusts reached 190 km/h, equivalent to a category 1 hurricane. Some weather stations recorded the highest wind speeds since recordings began. Rail services were suspended in Schleswig-Holstein and in and around Hamburg. Shipping was disrupted and many flights were cancelled. In the Netherlands gusts of 152 km/h were reported. Approximately 50 flights were cancelled from Amsterdam and there were delays in Rotterdam's port. Train services were disrupted at key stations, including Amsterdam, Utrecht, Rotterdam, Amersfoort and Groningen. Peak gusts of 147 km/h were recorded in Cap Gris Nez, France. 7,500 buildings were left without power, trains were delayed and some ferry connections suspended. Wind speeds of 193 km/h were reported in Denmark. Train and ferries stopped services. 80,000 properties were without power in Sweden and thousands in Finland.

Windstorm Christian losses up to €1.3bn

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