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Flood-hit German homes face higher premiums as climate risks grow
(Reuters, 26 Jul 2021) Consumer associations and adaptation specialists are exploring ways to share disaster costs more fairly across society.
Homeowners struggling to clean up after the deadly floods that swept Germany and Belgium last week could face an added financial strain in the years ahead as insurers move to hike premiums to reflect rising climate risks, industry analysts say.
"Market risk premiums have to be balanced with the underlying risk," said Ernst Rauch from Munich Re, adding that higher premiums were likely within two years following the flooding that killed 191 people in Germany and Belgium.
"Driven by the changing risk situation it's almost a 'must' in order to maintain a sustainable insurance scheme long term," Rauch, chief climate scientist at the insurance firm, told the Thomson Reuters Foundation.
Many other homeowners could be forced to take on debt to repair the damage: Less than half of German households have specific flood insurance cover even as climate change drives more frequent and severe flooding, according to Munich Re.
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Reuters, 26 Jul 2021: Flood-hit German homes face higher premiums as climate risks grow
