Europe faces €1.77bn economic losses after severe June weather: Aon cat report

The economic cost of a record breaking heatwave, severe storms and flooding in Europe in June 2019 is expected to exceed €1.774 billion ($2 billion), according to Aon’s monthly  Global Catastrophe Recap report.

Between June 10 and 12, severe weather brought large hailstones, strong winds and intense rainfall across a number of Central European countries. Hail damage in the greater Munich metro region was significant while other areas of Germany, Poland, Slovenia, the Czech Republic and Northern Italy were also hit.

The report estimated Europe-wide economic costs would be at least €915 million ($1.1 billion), with insurers expecting claims worth a minimum of €740 million ($830 million).

A second bout of severe storms affected Western and Central Europe on June 15 and 16, sweeping across Southwest France, canton Genève in Switzerland, Niedersachsen in Germany and parts of the Czech Republic and Austria. France was the worst affected, with the government declaring a state of disaster. Aon reported that total economic losses resulting from large hail, severe winds and intense rainfall was expected to exceed €500 million ($560 million), with insurers covering most of the losses.

France also saw record breaking heat with the mercury reaching 45.9 degrees centigrade on June 28 in Gallargues le Montueux, which was the highest temperature ever recorded in the country.

Temperature records for June and daily records were broken across Germany, Spain, Poland, Switzerland, Luxembourg, Lichtenstein, Andorra, and the Czech Republic.

The heatwave, recorded between June 24 and July 1, killed 13 people across southwestern and central Europe, although that number is expected to increase.

Michal Lorinc, a catastrophe analyst in the Impact Forecasting team at Aon, said: “An active start to summer in the Northern Hemisphere featured many large-scale weather events including severe thunderstorms, flooding, extreme heatwaves, and drought. Europe was at the center of many of these perils as record temperatures engulfed parts of France, and large hail and damaging winds led to more than US$730 million in insured costs in Germany alone. Impact Forecasting currently has a fully probabilistic hail model available for several European countries to help clients better understand the growing risks associated with hail to property exposure.”

In the US, June brought powerful thunderstorms and flooding rains, which affected parts of the Rockies, Plains, and the Southeast from June 8 to 10. At least three people were killed and more than a dozen were injured. The total economic losses were estimated to be $575 million, with public and private insurers expected to payout $400 million.

China faced flooding in June as seasonal rainfall began across central and southern parts of the country. The worst affected regions were Guizhou, Jiangxi, Guangxi, and Guangdong where at least 200 people declared dead or missing. Nearly 200,000 homes and other structures were flooded, with more than 430,000 hectares (1.06 million acres) of crops damaged by water. Aon said the seasonal flood toll in China was listed at CNY42.4 billion ($6.1 billion).

China’s Sichuan Province was struck by a magnitude-5.8 earthquake on June 17, killing at least 13 people and injuring 226. While around 156,000 homes were damaged. The total economic losses were estimated to be at least CNY8.9 billion ($1.3 billion).

In India, ongoing drought conditions destroyed an estimated 60 percent of orange orchards in the state of Maharashtra. Potential losses were estimated from INR 50-70 billion ($720 million to $1 billion). This increased the India-wide year-to-date drought losses to around $1.75 billion.

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