The response of European insurance companies stock market returns to possibly climate-related disasters

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Authors: Jörg Döpke, Lars Tegtmeier
Cited by: 1
References: 41

Abstract

This study examines the Ec of extreme weather events in Europe on stock market returns for European insurance companies. Using event studies and multivariate regression analysis on the stock prices of 23 European insurance companies in the aftermath of the 10 largest possible climate-related natural disasters in Europe between 2000 and 2024, the study addresses the question of how these returns are affected by the disasters. The results indicate only moderate and unsystematic responses. Furthermore, the study suggests that stock markets distinguish between property and liability insurers (P&L) and reinsurers and that their stock prices react differently to extreme weather events in Europe. Additionally, no systematic variation was discerned in the impact of different climate-related natural disasters on the performance of insurance companies. • This paper investigates the effect of ten major, possibly climate-related natural disasters in Europe (2000–2024) on stock market returns of 23 European insurance companies using event studies and regression analysis. • The results show only modest and unsystematic responses of insurance stock returns to climate-related disasters, with no consistent pattern across different event windows or disaster types. • The study suggests that stock markets distinguish between property and liability insurers (P&L) and reinsurers, and that their stock prices react differently to extreme weather events in Europe. • Regression analyses show that the magnitude of the disaster or the size of the insurer has only a limited impact on abnormal returns. However, reinsurers tend to react more negatively to extreme weather events in Europe. • Compared to studies based on data from the U.S., the European insurance sector appears more resilient or less reactive to climate-related financial risks, suggesting differing market dynamics or expectations.

Fields of Study & Subjects

Insurance and Financial Risk Management Agricultural risk and resilience Flood Risk Assessment and Management

Publication details

Journal / source
Journal of Climate Finance
Publisher
Elsevier BV
Volume
14
Pages
100081–100081
Publication date
21 February 2026
Language
EN