An average temperature of 16.8°C was measured in June, July and August 2023, making this year’s summer the hottest by far since the EU Copernicus Climate Change Service began its official records. The average temperature was 0.7°C above the long-term average. 

Climate change is resulting in higher average temperatures in a long-term comparison, a trend that is associated with contradictory effects. On the one hand, there are periods characterised by record temperatures when the soil dries out. On the other hand, higher temperatures favour more frequent heavy precipitation. This leads to increased flooding because the dry soil is unable to absorb the water. Heavy precipitation also often causes streams and rivers to burst their banks, with devastating effects on agricultural land, roads and settlements. We will also have to expect increased and more severe hailstorms in the future.  

In the Alps, climate change is having a particularly acute impact: higher average temperatures are affecting the permafrost that acts like a glue in holding debris together. If the permafrost thaws, there is an increased risk of debris flows and rockfall. This poses a threat to people living in the area, as well as to the infrastructure required for tourism.

With natural hazard losses set to become more frequent in the future, Switzerland is in the fortunate position of having an established insurance system in place for natural hazard losses affecting real estate. In 19 cantons, this cover is provided by cantonal building insurers; in what are known as the “GUSTAVO” cantons (GE, UR, SZ, TI, AI, VS, OW and also FL), the insurance cover is provided by private insurance companies.  

Premiums and deductibles for natural hazard losses covered by private insurers are governed by the Ordinance to the Federal Act on the Oversight of Insurance Companies (IOA) and are uniform and binding throughout Switzerland for all risks. If natural hazards such as flooding or rockfall occur, the natural perils pool organised by private insurance companies plays a key role. Thanks to the pool, natural hazard losses affecting buildings and movable property can be settled among the member companies in the pool and covered by reinsurance.  

It is not only the direct damage, however, that causes distress to those affected. Flooded roads or washed out train tracks disrupt supply chains, which in turn can lead to business interruptions that soon prove costly for companies. In order to be able to guarantee security, the additional insurance cover offered by a business interruption insurance policy is recommended for all companies.

How can you protect yourself from the consequences of increasing natural hazard losses? There are now publicly available maps to help property owners assess the risks that their properties are exposed to. Depending on the situation, it is advisable to take preventive measures. Even a 30cm high wall in the right place on a property, for example, can help prevent or minimise damage.  

“Both private individuals and companies should address the risks associated with climate change as part of a holistic approach – also as part of a consultation session,” says Alex Lutz, Head of Property, Marine and Engineering Insurance at Baloise. “Preventive measures against the consequences of climate change and insurance coverage that is adapted to suit specific needs will continue to become increasingly important in the future.”