It’s been a good year since the tranquil Ahr valley became a disaster area. In the night from July 14 to 15, 2021, floods of rain made entire regions uninhabitable. Ahr and Erft burst their banks, taking bridges, houses and residents with them. More than 180 people lost their lives. The property damage was in the billions. For German insurers, the Bernd flood disaster was the worst natural disaster since records began, said Jörg Asmussen, general manager of the German Insurance Association (GDV), on Wednesday in Berlin. And not only the insurance industry, but also climate researchers and politicians warn: It will not be the last.
Climate change means that extreme weather events are becoming more frequent: drought in the east, heavy rain in the west. Many homeowners are not prepared for this. Their buildings aren’t ready for it, and neither are their insurance companies. You have protection against storms and fire, but not against heavy rain or flooding. These risks have to be insured separately. Many do without it: only every second residential building has such element protection, although the flood had temporarily triggered a small boom. But it’s gone again. Just like the discussion about flood protection.
It is clear to everyone: There can be no “business as usual”. “We have to invest significantly more in prevention,” demands Annegret Thieken, professor for natural risk research at the University of Potsdam. She is part of the team of scientists accompanying the reconstruction work in the flooded areas. What she observes is depressing: “Only 34 buildings have not been rebuilt in their old places,” reports Thieken. The rest is exactly where the water had flooded the basement and living rooms last year. There is no lack of insight, says the expert. But many homeowners would have no way of exchanging their property for a more protected one.
The total flood damage is estimated at 33 billion euros, 8.5 billion of which is attributable to insurers. So far, the companies have paid out five billion euros. Almost a quarter of the cases have not yet been settled because there are no tradesmen’s invoices or the reconstruction is not yet complete. This is due to the lack of material and skilled workers.
The longer it lasts, the more expensive it becomes for the insurers, because they replace the new value of the house and therefore bear the risk of inflation. New heaters are significantly more expensive today than they were last August. “Who knows what a door frame will cost next week?” says Sabine Krummenerl, Chairwoman of the GDV Private Customers Committee. Homeowners insurance premiums are likely to rise across the board.
The destructive power of the floods on the Ahr and Erft leads to a whole new dimension of damage. In the disaster areas, over 2,000 single-family homes with insured damage in excess of 100,000 euros had to be repaired. In the district of Ahrweiler, the average damage was 210,000 euros per residential building. This is the highest average damage ever measured for residential buildings. Every fourth house in the Euskirchen district was damaged.
“A quarter of those affected do not know how they can build their house better,” says expert Thieken from on-site surveys. Before the flood, over 70 percent of residents would have had no idea they lived in a flood-prone area. Hazard maps are outdated, and there is no nationwide natural hazard portal where every citizen can see what his or her situation actually looks like.
New buildings are still allowed in endangered areas. And every day 54 hectares in Germany are sealed so that water can no longer seep away there – that corresponds to 76 soccer fields. The insurers are demanding a ban on new construction in flood-prone locations and better structural adjustments. “Sometimes it is enough if buildings are not built at ground level but on a small base,” says Asmussen.
What the insurers don’t want at all is an idea that is finding more and more friends in politics: mandatory insurance against natural hazards. Asmussen believes that doesn’t help because it doesn’t create any incentive to protect oneself against natural hazards. Instead, a spiral of increasing claims and rising premiums is set in motion. Instead, insurers only want to offer new contracts with protection against natural hazards. All existing policies are to be converted at the same time. Customers should be able to object to the changeover.
The prime ministers of the federal states see it differently. They’re tired of stepping in with taxpayers’ money because homeowners don’t have insurance. The federal and state governments scraped together around 30 billion euros in reconstruction aid last year. If everyone is insured, they hope that one day the state Samaritan service will no longer be necessary.
After similar considerations in the past had always fizzled out due to constitutional concerns, the heads of the federal states have now given the Federal Ministry of Justice an inspection order. Justice Minister Marco Buschmann (FDP) must deliver by the end of the year. You are in contact with the other affected federal departments, the ministry said on request.
The Federal Ministry for the Environment generally likes the idea of mandatory insurance. “I have sympathy for compulsory insurance,” said State Secretary Christiane Rohleder the daily mirror. However, the devil is in the details. In order for compulsory insurance to really help, the deductible should not be too high. At the same time, however, the burden of the contributions should not be too high. In this respect, one will have to examine exactly how a corresponding insurance obligation could be designed. “In any case, it is important that more buildings are insured against natural hazards,” says the Green politician. Nobody should feel safe. “Since extreme weather conditions are increasing as a result of the climate crisis, damage to buildings can occur anywhere in Germany,” warns Rohleder.
