Natural catastrophes in focus: Winter storms

Winter storms are classified as a primary peril, putting them in the same category as tropical cyclones (e.g. hurricanes and typhoons) and earthquakes.

Although winds in winter storms are less severe than in tropical cyclones, large areas can be impacted by a single storm, and damage across different locations can see losses accumulate to multi-billion USD levels.

Winter storms mainly occur in Europe and North America but there are some significant differences between them. In Europe, most winter storms form over the North Atlantic Ocean and move eastward towards the continent. They are influenced by the jet stream, a fast-moving current of air that separates cold polar air from warmer subtropical air. The jet stream can produce areas of high wind shear, where the speed or direction of the wind changes rapidly over a short distance. This can enhance the development and intensity of winter storms. The jet stream also steers the storms towards specific regions, such as the British Isles, Scandinavia, France, Germany, and the Alps.

In North America, winter storms can form over different parts of the continent, such as the Gulf of Mexico, the Pacific Ocean, or the Arctic. They can also move in different directions, depending on the prevailing atmospheric patterns. Some storms move from west to east across the continent, following the path of the jet stream. Others move from south to north along the eastern coast, forming what are known as nor'easters. These are particularly powerful and destructive storms that can affect large areas from the Mid-Atlantic to New England.

In Europe, winter storms tend to affect more densely populated and urbanized areas, where there is a higher concentration of insured assets and economic activity. This means that even moderate storms can cause significant losses and disruptions, especially if they occur during peak hours or on weekdays. In addition, many buildings in Europe are older and less resilient to wind damage than newer construction.

In North America, winter storms can affect both rural and urban areas, but the population density and insurance penetration are generally lower than in Europe. This means that the direct losses and impacts of winter storms may be lower in absolute terms, but the indirect losses and impacts may be higher, especially for remote or marginalized communities. For example, winter storms can cause widespread power outages, road closures, supply chain disruptions, and health risks, especially for those who rely on heating or medical equipment.

There is much that can be done to manage the risks and minimize the harms of winter storms. These include actions that individuals, businesses, and governments can take. These include: 

1. Ensuring snow and ice maintenance programmes are in place 
2. Confirm workers have proper gear to reduce cold stress and health risks 
3. Take steps to minimize the risk to drivers and vehicles 
4. Plan for winter utility impacts and outages for vulnerable supplies and operations  
5. Plan for transportation delays and travel system failures
6. Clearing snow and ice from roofs, gutters, sidewalks, and driveways to prevent damage and injury
7. Supporting vulnerable populations by checking on them regularly and providing shelter and assistance 

By implementing these risk management strategies, the exposure and vulnerability to winter storms can be reduced, and the resilience and recovery can be enhanced.

European winter storms represent an ever-present primary peril loss-making threat.

In February last year, a cluster of three winter storms (Eunice, Dudley, Franklin) hit northwestern Europe, resulting in combined insured losses of more than USD 4 billion, above the previous 10-year average of winter storms losses of US 2.5 billion. In the decades before, there were larger loss events. For instance, winter storm Kyrill in 2007 resulted in insured losses of USD 10.6 billion (adjusted to 2022 prices. History shows that European winter storm activity is variable on a decadal time scale. Recent storm activity has been below-average. However, it is important that risk modelers and underwriters are not lulled into a false sense of security by assuming lower activity will remain indefinitely.

Meanwhile, in the absence of major events, the share of European winter storms in annual natural catastrophe-related insured losses has been declining since the large storms of 1990 (winter storms Daria and Vivian) and 1999 (winter storms Lothar, Martin and Anatol). Nevertheless, winter storms are an ever-present hazard in Europe and, as the 2022 experience shows, just one event or cluster of storms can result in significant property damage.