Gallagher Re has partnered with Newcastle University on a multi-year research project examining how extreme wind and flood events interact across Europe. The project, housed within the Co-Centre for Climate + Biodiversity + Water, will run through 2029.
Most existing risk models assess rainfall and wind as separate hazards rather than examining how the two compound during the same event. Gallagher Re said this gap can lead to significant underestimation of risk, with knock-on effects for reinsurance pricing, contract structuring, and portfolio management.
The partnership follows Gallagher Re's own flagging of compound risk as a growing blind spot for the industry. In its full-year 2025 Natural Catastrophe and Climate Report, the reinsurance broker noted that AI models still need further development to improve precision around precipitation and other compound features driving overall storm risk.
Chief science officer Steve Bowen said the complexity of natural catastrophe events was accelerating the need to understand how physical and non-physical risk profiles are evolving.
Europe's recent loss record underscores the urgency. In 2024, Storm Boris swept across central Europe, triggering severe flood damage in Austria, the Czech Republic, Poland, and neighboring countries. PERILS estimated final insured losses at €2.153 billion, with total economic losses reaching €7.6 billion. Bowen, commenting at the time, said costs would be "measured in the billions."
The July 2021 floods across Germany and western Europe remain the continent's costliest flood disaster in recent memory. Munich Re put total economic losses at €46 billion, €33 billion of that in Germany. The German Insurance Association estimated insured property damage at €7 billion.
Gallagher Re pointed to the winter of 2013/14 in Ireland and the UK as a direct example of the kind of compound event the Newcastle University project aims to study. That season brought a succession of storms combining heavy rainfall with sustained strong winds, causing widespread flooding, structural damage, and transport disruption.
Research published by the Royal Meteorological Society found it was the wettest winter on record for the UK since 1910 and the stormiest for both the UK and Ireland. The Environment Agency estimated total economic damage in England and Wales at £1.3 billion. A study in Nature Climate Change put insured flood losses in southern England alone at £451 million.
The research is expected to help Gallagher Re identify portfolio concentrations where combined wind and rainfall risks are most acute. The project will also explore advances in seasonal and longer-term weather forecasting, which the company said would support more informed reinsurance placements and regulatory submissions.
Newcastle University's Hayley Fowler is leading the project as principal investigator, with Colin Manning serving as postdoctoral researcher.
