For the insurance industry and for everyone that keeps a close eye on climate extremes, 2022 will be remembered as the “Year of the Hailstorm” in Europe. Unprecedented hail occurrences created larger-than-expected losses and payouts across many European countries this year, particularly France.
Losses totaling billions of euros have upended the current understanding of severe convective storm average annual losses in Europe. This has placed the spotlight on catastrophe modelers to deliver the most accurate representations of severe convective storms. But how unprecedented has 2022 been in terms of hail occurrences and loss?
First, we must examine the climatology of the severe convective storm peril across Europe and, in turn, the subsequent long-term averages for each of the corresponding sub-perils.
Examining Severe Convective Storms in Europe
Severe convective storms typically produce heavy rain and frequent lightning strikes. If a storm is intense enough – and the atmospheric conditions are in balance to make these storms intense – they can also produce large, damaging hailstones, strong damaging winds, and even tornadoes.
According to an analysis of the monthly reports cataloged with the European Severe Weather Database (ESWD), Europe’s severe convective storms occur most often between the months of May and September. This comparison will examine the sub-perils that cause the most loss – hail, severe wind, tornadoes, and lightning – in these peak months.
When looking at 2017-21, we see a five-year average of 10,177 reports per year for hail, wind, tornadoes, and lightning events logged with the ESWD.
Here is a breakdown of the average annual number of reports by sub-peril:
3,275 hail occurrences
5,302 severe wind occurrences
1,048 lightning strikes
Looking at 2022, the overall number of severe convective storm occurrences has increased dramatically. There was a total of 15,170 reports of hail, wind, tornadoes, and lightning – a 49.1 percent increase over the five-year average.
Examining the sub-peril contribution to the overall 2022 European severe convective storm season shows which sub-peril was dominant as well as the comparison to the 2017–21 averages:
What is clear is that while we see a modest increase in severe damaging winds and lightning events, hail represents the main driver of severe convective storm reports in 2022, more than doubling the five-year average. Figure 1 shows how 2022 compared to the annual severe convective storm sub-peril totals of 2017–21 as well as the five-year average for reference.
Significant Losses This Year
This frequency increase in hail events has produced significant insured losses during 2022. The season could potentially eclipse the €6 billion to €8 billion (US$5.9 to US$7.9 billion) losses from France’s three periods of active hail-producing storms between May and July.
The events from May 21–23, June 2–5, and June 18–July 4 brought baseball-sized hail, damaging winds, a few tornadoes, lightning strikes, and torrential rains leading to flooding.
During May, events initially hit areas across western coastal France into northern France and the Paris Basin, which by early June extended through the remainder of France to then slam the country again from mid-June into early July.
According to initial press releases from France Assurers, the French insurers’ association, insurers received nearly 960,000 claims totaling a staggering €3.9 billion (US$3.85 billion) from the three periods of damaging thunderstorm activity. Most of the claims were for homes and autos, making up nearly 87 percent of the total losses, with the remainder accounting for professional goods losses as well as crops and agriculture.
Insurers responded by racing to fulfill the unprecedented number of claims filed by insureds through the period. But in September, Insurance Insider reported that further claims development effectively doubled the initial €3.9 billion (US$3.85 billion) aggregated three-event losses tabulated by France Assurers.
The losses in France from this summer’s hailstorms were no doubt on the exceptional side, not only because of the frequency of occurrences but also from a loss perspective. That being said, a few events over the last 10 years have caused large financial losses.
For example, in June 2019, Croatia, France, Germany, Poland, and Slovenia saw an outbreak of hail-producing storms that generated losses of €877 million or US$866 million (2022 equivalent). In 2013, severe weather in France and Germany from June 17–August 6 produced losses of €4.7 billion or US$4.64 billion (2022 equivalent).
However, viewing this event from a continental perspective would likely increase the frequency such that the overall event return period would be significantly less than 100 years.
Juergen also made an important point: Although no single factor can be attributed to climate change in these events, a warming atmosphere can hold tremendous amounts of moisture. And this could lead to an increase in the frequency of these types of events.
These events – coupled with increasing costs and demand for raw materials, shortages of workers ready to repair property and infrastructure after an event, and expanding urban sprawl – have led to demand within the (re)insurance industry for more precise modeling of the severe convective storm peril.
This demand is not only from the perspective of the average annual loss and lower return periods but, as shown with the 2022 France events, in the middle return periods where many of the recent higher loss recent events reside.
Most importantly, accurate representations of hail swaths – in terms of length, width, and directional orientation – are the key to fully understanding the potential of these types of events for the European insurance industry.
As Juergen’s blog post notes, the RMS Europe Severe Convective Storm HD Models marry well with actual observational loss data. This allows the industry to have an accurate representation of not only small, localized storm events but also widespread large, and more extreme events that occur over several days.
The importance of accurate extreme event modeling such as this summer’s France hailstorms and cross-country correlation for these types of storms is the reasoning behind the development of the RMS Europe Severe Convective Storm HD model.
Steve is a seasoned meteorologist and Senior Product Manager at RMS, involved in the catastrophe modeling industry for over 20 years and in the meteorological community for over three decades, with a track record of successful career development as an operational forecaster, research meteorologist, and catastrophe model developer.
Joining RMS in 2020, Steve provides in-depth knowledge of some of the most complicated natural catastrophe perils and oversees the development of the RMS North America Severe Convective Storm and RMS North America Winterstorm models, working closely with clients and across various RMS teams to deliver and execute the vision, strategy, and roadmap for these models.
Steve holds a degree in Meteorology from Northland College and is a member of the American Meteorological Society, the International Society of Catastrophe Managers, and the National Weather Service SKYWARN Storm Spotter Program.
His meteorological forecasting insights were accredited to saving lives ahead of and during the May 1999 Oklahoma and Kansas tornado outbreak and in 2004, with Hurricane Ivan in the Cayman Islands.
This has led to keynote speaking engagements within various worldwide government agencies to talk about global urbanization and its effects on the climate and natural peril frequency and severity in 2002, 2005, 2006, 2008, 2012, and 2017.