General Insurance Article - PwC estimates insurance losses from Storms Eva & Desmond

 "If rain continues to fall in large quantities, and the areas with warnings in place do indeed flood significantly, it could well be that the total economic losses could breach £1.5bn with an additional significant increase in insurer losses from our initial estimate. 

  

 "The insurance losses that arose from the flooding and storm damage during Storm Desmond were severe but were within nearly all affected insurers' large loss expectations for 2015, as 2015 was such a benign year prior to the December weather. The additional damage from Storm Eva and any further damage caused by additional rain will impact relevant insurers' year-end profitability. It is too early to say whether it causes the 2015 profitability of the household and commercial property business they write to be loss-making."

  

 Domenico Del Re, head of catastrophe management at PwC, comments:  "Recent additional flooding once again highlights a need to recognise that the introduction of Flood Re and the rebuilding of flood defences will not automatically solve the affordability of flood insurance, nor will it stop flooding when severe rain falls. Following the 2007 floods, a lot of work was undertaken on flood defences but clearly more can be done. Flood defences cannot stop everything, as they are based on historical information, but a lot more information exists today than there was even five years ago. Businesses (which are not covered by Flood Re) need to make use of all the flood data that is out there to make themselves more resilient when a flood occurs."