Insured losses from flooding this year in Central Europe is expected to amount to EURO EUR1.25 billion ($1.48 billion under current exchange rates), according to a report by Guy Carpenter & Company Ltd.
"European Flood Report 2005--Central and Eastern Europe," is a detailed summary and review of 2005 Central and Eastern European flood activity. The report examines resultant damage and insured losses across Switzerland, Germany, Austria, Romania and Bulgaria. It also looks at unrelated spring and summer flooding in Romania and Bulgaria.
According to Guy Carpenter--a member company of Marsh & McLennan Companies in New York--various reinsurers expect to pay out between EUR15 million ($17.8 million) and EUR65 million ($77 million) in insured losses across flood-affected areas in Central and Eastern Europe, with Switzerland suffering the greatest losses.
The overall economic loss to Central Europe alone is estimated to be around EUR2.3 billion ($2.7 billion).
"The mid-August floods in Central Europe were the most significant event of 2005 and the worst the region has seen since 2002," said Hanspeter Hilfiker, senior vice president at Guy Carpenter. "Switzerland experienced almost unprecedented economic damage--more than EUR1.7 billion ($2 billion)--but Germany and Austria were hard hit as well, with thousands of properties affected and hundreds of people forced to evacuate across Central Europe."
Floods in Eastern European were "also severe," according to the report, "with Romania experiencing its worst flooding in more than 30 years, but insured losses there were low in comparison because of the relatively low number of households with flood insurance coverage."
Among the report's highlights:
o Switzerland experienced heavy August rainfall--in several regions the heaviest on record--causing extensive damage throughout the country and severe flooding, especially in Bern and Lucerne. Insured losses in Switzerland totaled EUR1.2 billion ($1.4 billion).
o In Germany and Austria, several rivers overflowed, causing extensive damage in Bavaria and the western Austrian provinces of Voralberg and Tyrol. Economic losses in Bavaria alone were expected to reach EUR172 million ($203.7 million), which is still significantly less than the EUR345 million ($408.5 million) incurred during the 1999 floods. The Austrian Insurance Association estimates insured flood losses of around EUR100 million ($118.4 million), compared to a loss of EUR400 million ($473.6 million) suffered during the 2002 floods.
o With 69 people killed, more than 30 towns affected and 13,000 people forced to evacuate, northern Romania suffered heavy flood damage. The Romanian government estimates more than EUR1.5 billion ($1.8 billion) in total damages from the spring and summer floods, which may have a significant impact on the country's economic growth in 2005.
o In Bulgaria, the 2005 floods affected more than a quarter of the nation's population, with government damage estimates totaling EUR520 million ($615.7 million).
The full report is available for download at www.guycarp.com. Printed copies can be obtained by contacting Guy Carpenter at [email protected].
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