Flood losses in Europe are increasingly coming from heavy rainfall in smaller communities rather than major river floods, according to new research from Gallagher Re.
The reinsurance broker said that shift is creating accumulations insurers may not see in their historical loss data.
The white paper, A Risk in Flux: Exploring Europe’s Changing Flood Reality for Insurers, draws on KatRisk’s high-resolution flood hazard and flood defence data and Gallagher Re’s Europe Flood Model. The model covers both river (fluvial) and rainfall-driven (pluvial) flooding.
The paper cited German Insurance Association (GDV) data showing that 32 of Germany’s 37 largest flood-related insurance events since 2002, or 86%, were mainly driven by heavy rainfall and flash flooding. Only five were mainly caused by rivers.
Storm Bernd in 2021 showed the scale of the risk. It mainly hit small river catchments and communities of fewer than 50,000 people, yet generated more than €10 billion of indexed insured losses, the costliest flood in modern German insurance history.
Gallagher Re said investment in defences has reduced losses in many historically flood-prone cities. But flood risk is becoming more dispersed as exposure grows in smaller catchments, suburban developments and communities away from major rivers.
“While those risks remain important, today’s loss landscape is increasingly being influenced by rainfall-driven flooding affecting smaller communities and catchments beyond traditional flood zones,” said Dave Egan (pictured), head of international property practice at Gallagher Re.
The research also pointed to the value of flood protection. Gallagher Re’s analysis of Storm Boris in 2024 found existing defences reduced losses by up to 50%. On an inflation-adjusted basis, the event produced about €3 billion less insured loss than the 2002 Central European floods.
Martyn Sutton, general manager at KatRisk, said high-resolution modelling showed how rainfall-driven flooding, smaller catchments and local flood defences could significantly change exposure.
The findings echo what is happening in the UK. Research published this week by Flood Re noted that the National Flood Risk Assessment identifies low-depth surface water flooding as the fastest-growing flood risk facing households. The Environment Agency estimates 4.6 million people are at risk of surface water flooding in England.
Surface water flooding, like the pluvial events in Germany, can strike away from rivers and traditional flood zones, often in places where homeowners and businesses do not consider themselves at risk.
For insurers and reinsurers, the message is that historical loss experience may understate future accumulations. Portfolios built around avoiding river flood zones can still carry concentrated pluvial exposure in towns and suburbs that have never flooded badly. Modelling that captures both rainfall-driven flooding and local defences is becoming essential for underwriting, reinsurance buying and capital planning.
For brokers, the shift matters at the client level. Commercial and household clients outside traditional flood zones may assume flood is not their problem. Surface water flood maps, rather than river flood maps alone, give a fuller picture of risk. Brokers placing property programmes in Europe should also expect reinsurers to scrutinise pluvial accumulations more closely at renewal.
