Insurers face extensive financial impact from extreme rain that led to severe flooding in eastern and southern Spain during late October, according to Aon analysis.
Primary insurers largely retained catastrophe losses that could exceed $102 bn globally in the 9 months of the year, $80 bn of that in the United States.
The disaster caused widespread damage to property and infrastructure, particularly in the Valencia and Castilla-La Mancha regions, with additional hail damage reported.
Thousands of homes, commercial and industrial sites, fields, and vehicles suffered damage. Insurance claims will be managed by the insurance consortium Consorcio de Compensación de Seguros, alongside private insurers, while Agroseguro will handle agricultural losses.
A report from UNESPA, the re/insurer association, indicated a 77% insurance take-up rate for homes in Valencia Province, compared to the national average of 74%.
Hail damage was also significant, with officials in El Ejido estimating losses at approximately €100 mn ($108.6 mn). Aon noted that flooding accounted for most of the damage, and other areas remain under weather warnings as heavy rain began on October 27.
Valencia has a history of significant floods. The Gran Riada de Valencia in 1957 inflicted economic losses of around $2.1 bn in today’s terms.
That event prompted the rerouting of the Turia River, sparing Valencia’s city center from major flooding this time, although areas to the south experienced severe impact.
In late October 2024, eastern and southern Spain experienced catastrophic flooding due to unprecedented rainfall.
On October 29, the Valencia region received over 300 millimeters of rain in a single day, with the town of Chiva recording nearly 500 millimeters in just eight hours—equivalent to a year’s worth of precipitation.
This deluge transformed streets into torrents, sweeping away vehicles, inundating homes, and causing widespread devastation.
As of early November, reports indicate at least 217 fatalities, with the majority occurring in the Valencia region. Many victims were found in their vehicles or homes, overwhelmed by the sudden rise of floodwaters. Additionally, numerous individuals remain missing, prompting ongoing search and rescue operations.
The floods inflicted severe damage on infrastructure. Roads and bridges were destroyed, rail lines disrupted, and power outages affected tens of thousands. In Paiporta, a town near Valencia, a bridge collapsed under the force of the water, highlighting the intensity of the disaster.
The economic impact is substantial, with estimates of damages reaching into the billions of euros.
In response, the Spanish government declared three days of national mourning and mobilized extensive resources for relief efforts. Over 1,700 soldiers were deployed to assist in rescue and recovery operations.
Prime Minister Pedro Sánchez announced a €3.76 bn aid package to support reconstruction in the affected areas.
Despite these efforts, criticism has emerged regarding the timeliness and adequacy of the official response, leading to public protests and demands for accountability.
Meteorologists attribute the extreme rainfall to a meteorological phenomenon known as a “cold drop” or DANA (Depresión Aislada en Niveles Altos), where cold air at high altitudes interacts with warmer, moist air masses, resulting in intense and prolonged rainfall.
Scientists suggest that climate change may have intensified these effects, contributing to the severity of the flooding.
The late October floods in Spain stand as one of the nation’s most devastating natural disasters in recent history, underscoring the need for enhanced infrastructure resilience and improved emergency preparedness in the face of increasingly extreme weather events.
