(AFP) Google News 10 Jul 13;
BERLIN — Floods that caused billions of dollars (euros) in losses were the world's most expensive natural disasters so far this year, with central Europe being hit hardest, reinsurers Munich Re said on Tuesday.
Altogether, natural catastrophes -- also including earthquakes, tornados and heat waves -- caused $45 billion (35 billion euros) in losses in the first half of 2013, well below the 10-year average of $85 billion.
Insured losses worldwide totalled about $13 billion, said Munich Re.
Inland flooding that affected parts of Europe, Asia, Canada and Australia caused about 47 percent of overall global losses and 45 percent of insured losses, said the leading reinsurance company based in Munich, Germany.
The deadliest disaster out of 460 recorded "natural hazard events" worldwide was a series of flash floods in northern India and Nepal that killed more than 1,000 people in June after early and exceptionally heavy monsoon rains.
By far the most expensive natural disaster was the river flooding that hit southern and eastern Germany and neighbouring countries in May and June, causing more than $16 billion in damage, most of it in Germany.
"The frequency of flood events in Germany and central Europe has increased by a factor of two since 1980," said Munich Re board member Torsten Jeworrek.
In some places, 400 litres of rain per square metre fell within a few days. With the ground already saturated from the rainiest spring in half a century, this led to rapid swelling of the Danube and Elbe river systems.
Peter Hoeppe, head of Munich Re's Geo Risks Research unit, said in a statement that "it is evident that days with weather conditions that lead to such flooding are becoming more frequent".
As weather systems tend to remain stationary for longer, he said there was a higher chance for heavy and long-lasting rains, and for summer heatwaves and droughts.
"Debate in climate research is currently focusing on what the causes of such changes in weather patterns could be and what role climate change might play in this," he said. "But it is naturally not possible to explain single events on this basis."
The second most expensive disaster was a series of severe tornadoes that hit the United States in May, especially a maximum-strength tornado that devastated the Oklahoma City suburb of Moore.
The tornado, which killed 26 people, left more than 270 injured and in Moore alone completely destroyed more than 1,000 buildings, caused an overall economic loss of more than three billion dollars, about half of it insured.
"The central states of the USA have the highest tornado risk in the world," said Hoeppe. "Altogether, however, the US tornado season has been below average so far: by the end of June, 625 tornadoes had occurred, compared with the longer-term average of 1,075."
Europe floods to cost insurers up to $4.5 billion: Swiss Re
Caroline Copley PlanetArk 9 Jul 13;
Europe floods to cost insurers up to $4.5 billion: Swiss Re Photo: Wolfgang Rattay
File picture shows a rescue team on a dinghy evacuating a man from the flooded district of the Bavarian town of Passau, about 200 km (124 miles) north-east of Munich June 4, 2013.
Photo: Wolfgang Rattay
Floods in central Europe last month may cost insurance companies $3.5-4.5 billion, only half of one previous estimate but more than was paid out for the last major washout in 2002, the world's second biggest reinsurer said on Monday.
The forecast from Swiss Re compares to an earlier warning from a damage modeling agency that losses could top $8 billion. That, and its estimate of a $300 million hit for its own results, saw shares in Swiss Re and some other sector firms rise.
The flooding in early June forced Czech soldiers to erect metal barriers and pile up sandbags to protect Prague's historic centre after days of heavy rains swelled rivers and forced evacuations from low-laying areas.
Emergency workers, soldiers and volunteers worked desperately to shore up flood defenses in towns along the Danube and Elbe rivers as the high water moved downstream in the following days, with Germany among the worst-hit.
German insurance trade body GDV last week estimated the country's insurers could face damage claims of nearly 2 billion euros ($2.57 billion), slightly ahead of the 1.8 billion cost seen in the Elbe floods a decade ago.
Floods which drowned Prague's historic Old Town and other cities in water in 2002 cost insurers around $3.4 billion.
The world's biggest reinsurer, Munich Re, is due to publish its estimate of insurance industry and economic losses on Tuesday, in an overview of natural catastrophes in the first half of the year.
It will release a figure for its own share of the losses from the floods, which also hit towns in Austria, Hungary, Poland and Slovakia, with second quarter earnings data on August 6.
Swiss Re said steps such as the mobile flood barriers used in Prague had helped spare many regions from substantial losses.
"Thanks to timely prevention measures, large areas have been saved from flooding," said Swiss Re's Group Chief Underwriting Officer Matthias Weber.
$8 BILLION
Reinsurers like Hannover, Munich Re and Swiss Re help insurance company customers cover the cost of major damage claims like hurricanes or earthquakes in exchange for part of the premium.
Earlier forecasts had resulted in far higher loss estimates, though industry observers caution that there are differences in what is included in the estimate, for example indirect costs such as relocation lodging or business interruption.
Catastrophe modeling firm AIR Worldwide had said insurance claims for flood damage in Germany alone may be as much as $8 billion.
Credit rating agency Fitch had put losses at up to 3 billion euros ($3.85 billion) in Germany, while Insurance broker Willis estimated claims of 4 billion euros in Europe.
Europe's biggest insurer, Allianz, has penciled in claims of 500 million euros from the floods across Europe, before passing on some costs to reinsurers.
Vontobel analyst Stefan Schuermann said the claims burden would pose little threat to Swiss Re's earnings and ability to pay a high dividend.
"This first major natural catastrophe loss event will impact second quarter results but year-to-date natural catastrophe claims remain well below budget having experienced virtually nothing in the first quarter," Schuermann said.
Shares in Swiss Re were trading up 1.2 percent at 71.10 Swiss francs by 5:50 a.m. EDT, while the STOXX Europe 600 insurance index rose 1.9 percent.
Munich Re shares rose 2.4 percent.
Swiss Re reported a 21 percent rise in profit in the first quarter, driven by a rise in premium and fee income, low catastrophe losses and the expiry of a quota share agreement with Warren Buffett's Berkshire Hathaway.
(Additional reporting by Jonathan Gould in Frankfurt; Editing by Edwina Gibbs and Patrick Graham)
