The cost of the damage wreaked by Storm Éowyn is likely to exceed €100 million for the insurance industry, judging from past storms, while experts have predicted the growing prevalence of such events will likely lead to higher premiums for consumers.
The storm, which led to record high winds that included gusts of 183km/h in Galway, caused significant damage to homes and businesses nationwide, while a GAA centre of excellence in Mayo was very badly damaged and an ice-skating rink in Blanchardstown was effectively flattened.
Figures provided to The Irish Times by Insurance Ireland on the cost of severe weather events from 2000 to 2023 show events categorised as “storms” alone ranged in cost from a low of €16 million in January 2009 to a high of €111 million in February 2014.
While major flooding in 2011 cost €127 million, the hit has tended to be much greater in the presence of freezing conditions, with events in December and January of 2010 costing insurers €224 million and €227 million respectively.
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Insurance Ireland chief executive Moyagh Murdock said on Friday it would “take time” to get assessments and repairs done following Storm Éowyn, as well as to get an estimate on the insured cost of the event.
Broadly speaking, premiums are tied to the volume of claims and the cost of settling them. With property, industry experts said the cost of settling claims has increased considerably over the past 18 months in large part due to inflation.
“Taken together with more frequent adverse weather events, this means we have seen and will likely see increases in property and motor insurance cover, and, in many cases, quite considerable increases,” said one.
Daragh Cassidy, spokesman for price comparison group Bonkers.ie, also said any growth in the prevalence of such events will eventually lead to higher premiums.
“If your home becomes more risky to insure due to the increased threat from storm damage and natural disasters, then the price of your insurance will eventually go up,” he said.
“Or you may not be able to get insurance at all. This isn’t something we’ll see overnight. But in an increasingly unpredictable climate, insurers will be reassessing how they price risk and what they’re prepared to insure.
“We’ve already seen this in America. Homeowners in California increasingly have difficulty getting affordable home insurance due to the threat of wildfires. And homes in parts of Florida are almost completely uninsurable due to the threat of hurricane damage.”
Ian O’Reilly, head of personal line sales at Chill Insurance, said: “Unfortunately, a continued increase in the prevalence of extreme weather events, like Storm Éowyn, could lead to an upward trend in home insurance premiums.
“These events drive higher claims frequency and severity, placing additional pressure on insurers to adjust premiums to reflect heightened risks. Regions more susceptible to severe weather may experience even greater premium increases as risks become more concentrated.
“That said, one-off big storm events don’t always result in immediate premium hikes. Most insurers mitigate the financial impact of such events through reinsurance programmes, which cap their exposure to losses.”
[ Mayo bears the brunt of ‘worst storm in years’ as winds reach 136km/hOpens in new window ]
Mr O’Reilly said underinsurance remains a “key concern” for both companies and consumers.
“Many homeowners may not realise that if their property is underinsured, any claim payout from a storm event could be reduced proportionately, leaving them responsible for covering the shortfall,” he said.
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“This risk has grown due to inflation and rising rebuild costs, making it more important than ever for homeowners to regularly update their sums insured.
“It’s crucial to stress the value of having comprehensive home insurance in place, as the financial burden of rebuilding without adequate cover can be devastating.”
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