Insurance Report: Natural Disasters Cause Billions in Damages, Especially in Southern Germany

Natural disasters wreaked havoc in Germany last year, incurring damages amounting to billions of euros. According to a report from the German Insurance Association (GDV), the total claims from property and auto insurers reached approximately EUR5.7 billion, a figure similar to that of 2023. A significant portion of these damages was concentrated in the southern states of Bavaria and Baden-Württemberg, where severe flooding occurred.

It is essential to note that the actual damages are likely to be much higher, as not all incidents were insured. In particular, estimates for the flooding in Bavaria and Baden-Württemberg suggested that of the total damages exceeding EUR4 billion, only about half were covered by insurance.

Severe weather events, including heavy rainfall and subsequent flooding, accounted for insured damages of around EUR2.6 billion--approximately EUR1 billion more than the long-term average, as indicated by GDV Chief Executive Jörg Asmussen. He highlighted that the impacts of climate change are becoming increasingly evident in Germany.

In contrast to the significant losses from flooding, damages from storms and hail were relatively lower last year. The auto insurance sector covered around EUR1.3 billion in claims due to natural disasters, aligning with the historical average. These figures do not specify the causes, which may include hail, storms, flooding, and other factors.

When examining damages by state, Baden-Württemberg reported insured losses of EUR1.601 billion, slightly surpassing Bavaria's EUR1.600 billion. This discrepancy may stem from the fact that natural hazard coverage, particularly for floods, is more commonly included in policies in the southwestern region than in Bavaria. Consequently, it is likely that the total damages in Bavaria could be higher, although specific figures remain unavailable.

In terms of other states, North Rhine-Westphalia incurred the third-highest insured losses at EUR613 million, primarily due to storms and hail. Following that, Niedersachsen reported EUR313 million in claims, while Hessen faced losses of EUR252 million. Other regions, including Saarland, Rheinland-Pfalz, and Sachsen, reported insured damages of EUR171 million and EUR166 million, respectively.

Conversely, Bremen experienced the least impact, with damages totaling only EUR17 million. Other city-states like Berlin and Hamburg reported damages of EUR39 million and EUR67 million, respectively. Mecklenburg-Vorpommern also fared relatively well, with reported damages of EUR34 million, making it one of the least affected regions.

Overall, the EUR5.7 billion in damages reported is relatively high in the context of long-term trends. Asmussen emphasized the urgent need for climate adaptation measures, urging that this should be a priority for the new federal government. He argued that merely implementing mandatory insurance would not suffice to prevent damages. Instead, a comprehensive strategy addressing natural hazards, including preventive measures alongside insurance solutions, is necessary to ensure long-term security for individuals and municipal infrastructure.

Furthermore, plans are in motion to introduce mandatory insurance for residential buildings within the current legislative period, as noted by Justice Minister Stefanie Hubig (SPD). She acknowledged that as climate change progresses, enhanced insurance coverage will be essential for future protection.