Europe's flood costs surge while Norway confronts heightened drought risk

A recent Allianz Trade report finds that flood-related economic losses across Europe have risen by about 40% since the start of the 21st century, climbing from €63.1 billion in the early 2000s to €88.6 billion in 2020‑2025 and reaching a cumulative €226 billion in the first quarter of the current century. The number of flood events remains stable at roughly 46 per year, but the concentration of population, infrastructure and economic activity in flood‑prone zones amplifies the financial impact. In affected countries, post‑flood investment falls by 10.5‑14.6% compared with baseline scenarios.

A separate study by the World Weather Attribution initiative shows that rising summer temperatures accelerate soil, river and lake drying, increasing evapotranspiration and raising the risk of severe drought in Norway, especially in the north and Svalbard. The heightened drought threatens agriculture, hydropower generation, forest fire incidence, river transport and ecosystem health, and could contribute to higher food and energy prices across Europe.