While the quality of the data available and the sophistication of risk modelling has improved in recent years, the industry must still absorb some hard lessons on European windstorm risks and also consider alternative means of risk transfer, says Eddy Vanbeneden.
In recent years, the insurance industry has greatly improved its approach to managing European windstorm risk.
The introduction and broad use of catastrophe modelling has played an important role in this evolution, and continuing improvements are being driven by the push for greater transparency and enhanced risk management. This drive is clearly illustrated by the upcoming Solvency II regime, which specifically addresses natural catastrophe scenarios that could potentially impair the financial stability of P&C insurance carriers.
Some of the recent European windstorms have demonstrated very distinct characteristics. Without entering into a debate about the impacts of possible climate change, these events have created new challenges for the insurance industry and catastrophe model vendors alike.
Insurance, Reinsurance, European windstorm, Europe