The 1999-2000 European windstorm season was memorable, with a cluster of 3 severe events in December 1999. The resulting losses in lives, property and financial damage motivated improvements in weather forecasting, energy security, forestry management, windstorm modeling and property exposure management.
Key Takeaways
Historical Rarity: Since the 1999-2000 European windstorm season, no other winter has brought the same level of destruction to Europe. If Anatol, Lothar and Martin were to reoccur on today’s exposures, the aggregate “as-if” pan-European loss from this series would be around a 1-in-60 to 1-in-80-year event, based on the latest models. Loss Impacts: Anatol’s impacts were concentrated in northern Europe, particularly in Denmark, with reported insured losses at EUR 1.7 billion. Damages from Lothar and Martin were concentrated in France. According to the French Federation of Insurance Companies (FFSA), insured losses totaled about EUR 6.8 billion (including hazards covered by the French public NATCAT scheme). Windstorm Clustering: The 1999-2000 season stands out not only because of the spatial and temporal proximity of the events, but also because Lothar and Martin both hit densely populated cities in France with strong intensity. Clustering generally increases annual aggregate losses by 5%-10% in Europe (up to 20% at longer return periods), with regional differences. The impacts of climate change on European windstorm clustering in the future is uncertain; there is ongoing research on this important topic. Event Definition: Since these storms, there is increased scrutiny of reinsurance contract wording to qualify the losses. There are many approaches, and one example is to specify that the losses have to arise from the same atmospheric disturbance. Property Exposure Management: In 1999, insurers bought reinsurance limits using their loss experience from the historical largest loss-causing event as a benchmark. Since Solvency II came into effect in January 2016, reinsurers manage their financial risk up to the 1-in-200-year modeled aggregate loss, which is higher than losses sustained from the 1999 storms. Hence, financial resilience has strengthened since 1999.
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