Windstorms Lothar and Martin (1999)
Two windstorms that crossed France a day apart at the end of 1999, still the benchmark for European windstorm risk and for the definition of an event in reinsurance.
Lothar swept across northern France, Switzerland and Germany on December 26, 1999, and Martin hit southwestern France the next evening. For French insurers, the blow was twofold: an unprecedented volume of claims to settle over the holidays with too few adjusters and contractors, and forests flattened over hundreds of thousands of hectares. In reinsurance, the two storms raised the question of how many there were: a per-event excess of loss treaty aggregates losses within a window of a few dozen hours, and two distinct but close storms could be counted as one or two, with opposite effects on the retention and on reinstatement of cover. Event definition clauses have since spelled out the length of the window and how to treat distinct phenomena. Model and regulatory European windstorm scenarios are still calibrated on this episode.
On December 26 and 27, 1999, Lothar and then Martin cost French insurers about 6.9 billion euros according to the French insurance federation, and cut power to more than three million homes.
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