Mesolcina Floods Drive Canton Insurance Claims to Two-Decade High
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the devastating floods of last summer in Mesolcina and surrounding areas have substantially impacted the canton’s building insurance (GVG),pushing damage claims to a level unseen since 2005. despite this surge in payouts, strategic investments have allowed the GVG to maintain financial stability and even post a profit.
Record Claims Following Extreme Weather
The GVG reports that the total sum of damages from the floods reached CHF 28.7 million. This figure represents a considerable increase in claims compared to previous years, highlighting the growing financial impact of extreme weather events. To put this in viewpoint, data from the Swiss Federal Office for the Habitat indicates a nationwide increase in weather-related damage costs over the past decade, with floods accounting for a meaningful portion of these expenses. For example, the 2021 floods in central Switzerland resulted in hundreds of millions of francs in damages, underscoring the vulnerability of Swiss infrastructure to climate change.
Investment Gains Offset Operational Losses
Despite the considerable payouts related to the flood damage, the GVG managed to achieve a consolidated total profit of CHF 30.6 million. This was largely due to a positive market trend that resulted in a profit of CHF 58.7 million on invested assets, representing a return of 7.95%. This investment income effectively covered the operational loss of CHF 14.8 million incurred due to the increased claims.
The consolidated total profit amounts to 30.6 million.
Financial Stability Maintained
The GVG emphasizes its financial strength, stating that provisions for current risks and capital investment fluctuations are fully covered. This robust financial position enables the insurance provider to confidently handle future large-scale damage events. This is crucial, as climate models predict an increase in the frequency and intensity of extreme weather events in the Alpine region, potentially leading to further increases in insurance claims.
the provisions aimed at covering the current risks and those of fluctuation in capital investments are 100%covered…it is financially stable and able to also face events with great damage.
The insurance provider also highlights its commitment to cost efficiency, noting that it maintains the lowest insurance premiums in Switzerland. This is attributed to significant cost savings and increased operational resilience achieved through a new organizational structure for asset management. By optimizing its operations, the GVG aims to provide affordable insurance coverage while ensuring its long-term financial sustainability.
…he has the lowest insurance premiums in switzerland and that he managed to save significantly on costs and increase operational resilience thanks to the new institution for the administration of the heritage.
