Windstorm Babet and Aline industry loss estimated at €509m by PERILS

Recent European windstorms Babet and Aline are initially estimated to have caused an insurance industry loss of around €509 million by catastrophe data aggregator PERILS AG.

The estimate is for the initial insurance market industry loss caused by the floods and storm linked to these two named windstorms in the British Isles and northwestern Europe during the period of 18th to 22nd October 2023.

These low pressure systems were named Babet by the UK Met Office (Viktor by the Free University of Berlin (FUB)) and Aline by the Spanish state meteorological agency (Wolfgang by the FUB).

PERILS industry loss estimate of €509 million covers the property line of business only and the industry-backed company said that the majority of the industry losses, around GBP 329 million, where in the UK.

These storms formed a large-scale weather pattern that moved in rapidly from the Atlantic to northern Europe.

Storm Aline and Babet brought flooding and strong winds to the British Isles and northwestern Europe, as the storms followed a track from south to north, which was deemed unusual as autumn storms normally track west to east.

In addition, the low-pressure systems became stationary when blocked by a high-pressure system over Scandinavia and thirdly, an easterly direction for some of the strongest winds drove a record storm surge along the Baltic coastlines of Denmark and Germany, and generated strong orographic rainfall over eastern Scotland, PERILS explained.

It made the insurance loss complex, especially with respect to questions of flood vs wind.

PERILS explained that, “The majority of the industry loss occurred in the UK and was due to flood losses, with limited wind-related losses. Similarly, flood was the dominant loss component in Ireland. In Germany, where flood and storm surge insurance is optional and therefore the insurance penetration is lower, wind damage is widely included as a standard component of property policies. As a result, flood and wind losses were roughly equal. In Denmark, however, flood and storm surge losses are covered by the “Naturskaderådet” government scheme and therefore only wind-related losses are covered by the insurance industry. Despite this complex coverage landscape, as the clear majority of the Aline-Babet industry loss is related to flood damage, PERILS has classified it as a flood event.

Luzi Hitz, Product Manager at PERILS, further explaind, “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.”

Babet and Aline are just two of the European windstorms that PERILS is investigating and the stronger winds of Ciarán (Emir) may drive a larger industry loss, while another storm Domingos (Fred) that affected France could also qualify for loss reporting.