Extreme weather events are increasingly becoming a major cost driver for the insurance industry in Europe. The reinsurer Swiss Re pointed this out on the occasion of the industry meeting in Baden-Baden, as reported by news agency «AWP».

The severe hail event in Switzerland on 28 August 2026 alone is believed to have caused insured losses of more than CHF 1.7 billion, according to initial estimates.

The severe weather affected in particular the cantons of Bern, Solothurn, Aargau, Zurich and Thurgau. Both gusts of wind and hail caused damage. “The same event over Zurich would probably have caused an even larger loss,” said Leopold Camara, Head of Reinsurance for Northern, Central and Eastern Europe at Swiss Re.

Some CHF 800 million of the estimated loss amount was attributed to motor vehicles. Vehicle damage is becoming increasingly significant in extreme weather events, Swiss Re said. Hailstorms in northern Italy also caused major damage in July and August.

Wildfires cause major damage

In addition to hail and storms, wildfires are also moving further into focus. According to a study cited by Swiss Re, losses from wildfires in Europe have risen by eight to eleven per cent annually over recent decades.

(Image: Shutterstock)

In France, larger areas were affected by fires in 2026 than in the past 20 years. In Spain, this year’s fires destroyed larger areas overall despite earlier years with more fires, said Nikhil da Victoria Lobo, Head of Reinsurance for Western and Southern Europe, the Middle East and Africa at Swiss Re.

Extreme heat and drought could also trigger additional economic damage. Low water levels in major rivers would impair freight transport and thus strain supply chains. Energy supply, infrastructure and agriculture would also be affected.
Reinsurance prices are developing differently

Swiss Re did not make any clear statements on price trends in the reinsurance market. Blanket claims that prices are falling would not do justice to developments, as different trends are emerging depending on business segment and region. Camara spoke of numerous “microcycles”.