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Germany expects most damaging year since 2002

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Storms, flooding, heavy rain and hail across June and July position this year to be the most damaging for Germany since 2002, when insured storm damage was €10.9 billion ($17.46 billion) in what were, prior to this month, deemed to be the worst floods in Europe this century.

The German Insurance Association (GDV) puts insured losses near €5 billion ($8 billion) in an initial preliminary estimate covering last week's flood disaster in North Rhine-Westphalia and Rhineland-Palatinate. Damage in Saxony and Bavaria is not yet included.

June rains and hail had already caused an estimated insured loss of €1.7 billion ($2.72 billion).

Since July 12, countries in Europe have been struck by catastrophic floods, killing at least 180. Belgium and Germany - as well as Austria, Luxembourg, the Netherlands, Switzerland and Italy - were all severely affected.

Initial estimates by the Belgian Association of Insurers peg market-wide losses at several hundred million euros. So far, the highest recorded loss from floods in Belgium is around €150 million ($240.36 million), in 2016, Allianz says.

Allianz’s Swiss operations expects well over 28,000 claims to be filed in relation to the various weather events since mid-June.

Over 21,000 claims have already been received, most of them related to motor insurance, with the total loss estimate over 103 million Swiss francs ($152.68 million). In previous record years of 2009 and 2012, Allianz Suisse had annual claims of around 90 million Swiss francs ($133.41 million) from natural catastrophes.

For Austria, Allianz says its current claims estimate is around €55 million ($88.04 million), excluding the losses related to the recent heavy rainfall.

The weather system caused a tornado in the Hodonin district of the Czech Republic towards the end of June, with wind speeds reaching up to 320 kilometres an hour. It damaged or destroyed more than 1,200 buildings and several fatalities were reported. Allianz has nearly 20,000 customers in the affected area.

Ratings agency AM Best says German insurers' disciplined pricing means carriers should be well-positioned to absorb heightened weather-related losses, despite potential record natural catastrophe claims in 2021.

Across Germany, nearly all residential buildings are covered for windstorm and hail, though only 46% of homeowners have protection against other natural hazards such as heavy rain and floods.

"The damage is likely to be even higher than that of the August flood in 2002 of €4.65 billion ($7.45 billion),” GDV CEO Jörg Asmussen said. “Bernd is one of the most devastating storms in recent history.”

The association will update loss estimates for the storms this week.

Allianz in Germany is donating a million euros to the rescue organisations involved.