German Insurers Report Below-Average Natural Disaster Claims in 2025

Heavy rain, flooding, storms and hail – also known as severe convective storms (SCS) – brought below-average claims for German insurers in 2025, defying the long-term trend for such perils, given the impact of climate change, according to the German Insurance Association (GDV).

The experience in Germany was similar to catastrophe losses seen by insurers and their reinsurance partners globally as indicated in Guy Carpenter’s recent report on the January 1 reinsurance renewal season.

“We are currently expecting losses of €2.6 billion [$3.1 billion] from natural hazards. This is around €3 billion [$3.5 billion] less than in 2024. The fact that there was less damage this year is a matter of luck. Overall, however, the number of extreme weather events caused by climate change is increasing,” commented Jörg Asmussen, managing director of the GDV.

The GDV noted that property insurance will account for around €1.4 billion ($1.6 billion) in losses from storms, hail and lightning in 2025, while €500 million ($587.3 million) in claims was caused by other natural hazards such as flooding and heavy rainfall.

In motor insurance, losses from storms and floods amount to €700 million ($822.2 million), including damage to houses, household contents, commercial and industrial enterprises and motor vehicles.

As a result of the long-term threat posed by extreme weather from climate change, the GDV last month proposed a reinsurance vehicle called Elementar Re, a public-private partnership. The proposed scheme aims to provide a model for how natural disaster risks can be made insurable and affordable.

“In view of the increasing risks, it is urgently necessary to expand holistic hazard prevention,” Asmussen emphasized.

In the event of a claim, Elementar Re would have two levels of private-sector protection: its own reinsurance and a gradually built-up guarantee fund. These would be supplemented by a government-backed stop-loss mechanism that only comes into play in the case of rare extreme events – that is, only when private-sector reserves have been largely exhausted.

Elementar Re would provide a targeted safety net for exceptionally severe disasters with a claim volume exceeding €30 billion ($35.1 billion).

“The government thus assumes neither the role of a primary insurer nor that of a permanent reinsurer,” the GDV said, noting that this approach would create a government-supported reinsurance solution that meaningfully complements the market without replacing it.

Photograph: Parts of the old town are flooded by the Danube river, in Passau, Germany, Thursday, June 6, 2024. (Armin Weigel/dpa via AP)

Topics Natural Disasters Trends Carriers Claims