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Natural disasters mean record year for German insurance payouts

  • December 27, 2021

German insurers paid out record sums in 2021 after high losses incurred by natural disasters, an industry group announced on Monday.

The cost of floods, storms and other disasters led to payouts of about €12.5 billion ($14.2 billion) for insured houses, household goods, businesses and motor vehicles, according to the German Insurance Association (GDV).

The bulk of that figure (€8.2 billion) came from the July floods that devastated areas of Rhineland-Palatinate and North Rhine-Westphalia and killed more than 180 people. The floods triggered a discussion about compulsory insurance for natural hazards, as well as restrictions on building in flood-prone areas.

Severe hailstorms in June also caused millions of euros in damage, particularly to vehicles.

These made 2021 “the most expensive natural hazard year since statistics began in the early 1970s,” GDV CEO Jörg Asmussen said.

The 2021 payouts even came ahead of 2002, when August floods and devastating storms contributed to an annual total of €11.3 billion in payouts. 

According to the German insurance industry, the long-term average is €3.8 billion per year.

  • Mass destruction as floods sweep across western Germany

    Houses collapsed, people trapped on roofs

    Heavy rainfalls and storms pounded Germany’s western states and caused rivers to burst their banks, inundating towns and villages. Torrential overflow swept away vehicles, destroyed roads and bridges and reduced some houses to rubble. Some survivors were trapped on their rooftops for hours before they were airlifted by helicopters.

  • Mass destruction as floods sweep across western Germany

    once-in-a-century floods

    The flood’s damage and death toll—about 200 dead—made it one of the deadliest disasters to hit the country in more than half a century. During the height of the flooding, some 1,300 people were reported missing in just one German district, Ahrweiler.

  • Mass destruction as floods sweep across western Germany

    Shuttered roads

    Phone and power lines are still down in some areas, at least two highway roads need fundamental repair. The damage to infrastructure hampered immediate rescue efforts and threatened to leave the affected regions facing a long and difficult road to recovery.

  • Mass destruction as floods sweep across western Germany

    Rescue workers face danger

    At least four firefighters in the German state of North Rhine-Westphalia lost their lives during rescue operations since flooding began Wednesday, according to Bernd Schneider, chairman of the NRW Firefighters Association.

  • Mass destruction as floods sweep across western Germany

    Dams threaten to burst

    Dams across the region reached their capacities and threaten to overflow amid the massive rainfall. The flood, damaged water facilities and created a water shortage in some regions.

  • Mass destruction as floods sweep across western Germany

    A terrifying situation

    Chancellor Angela Merkel visited the badly-hit town of Schuld, personally surveying the damage and speaking to residents and emergency workers. She described the situation as “terrifying” and called for more to be done to tackle climate change in the wake of the floods.

  • Mass destruction as floods sweep across western Germany

    Army deployed to help out

    Over a thousand soldiers and more than 200 military vehicles have been deployed in western Germany over the last few days, as volunteers line up to help flood victims. As the water begins to recede, questions are emerging over whether residents received timely warnings before the floods. Critics say that if the country was adequately prepared for disaster, the loss would have been much less.

Climate change worsening disasters

Thanks to climate change, researchers expect losses from floods, hail or severe storms to increase in countries such as Germany in the coming years.

Insurance giant Swiss Re estimated earlier this month that natural disasters had caused $105 billion in damages globally, with hurricane Ida in the US costing $30-32 billion.

Also on Monday, UK charity Christian Aid estimated that the 10 most expensive weather disasters caused more than $170 billion in damages in 2021 — $20 billion more than in 2020.

In its annual assessment, it said the 10 events were worsened by man-made climate change and together killed at least 1,075 people and displaced 1.3 million.

The most expensive events included Hurricane Ida, flooding in Germany and Belgium (which it estimated at $43 billion in losses), winter storms in Texas, flooding in China’s Henan province, flooding in Canada, late spring frosts in France and a cyclone in India and Bangladesh.

“The costs of climate change have been grave this year,” said Kat Kramer, climate policy lead at Christian Aid.

aw/msh (dpa, AFP, Reuters, AP)

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