RMS Estimates Record Insured Losses From European Windstorms Lothar and Martin.

Business Editors & Insurance Writers

MENLO PARK, Calif.--(BUSINESS WIRE)--Dec. 28, 1999

Risk Management Solutions, Inc. (RMS(TM)) today announced that the two windstorms Lothar and Martin that swept across western Europe over the past several days will result in unprecedented levels of insured losses in France.

RMS has also estimated that total losses from the storms across all affected countries could possibly exceed the losses from Windstorm Daria in 1990 (storm 1990A). To date, Daria has ranked as the most expensive insurance industry event ever in Europe, with losses of close to 6 billion Euros (US$6.1 billion) in 1999 values.

RMS has been running simulations of storm damage with RMS' proprietary European Windstorm model since Lothar crossed into northwestern France early on the morning of Sunday, December 26th. Lothar traveled on an easterly track across the whole of northern France, with the area of most intense winds moving directly over Paris and into eastern France. In the mountains east of Paris, windspeeds were recorded up to 60 m/s (134 mph), equivalent to Category 2 on the Saffir-Simpson hurricane scale. At Orly Airport to the south of Paris, winds were recorded at speeds of 48m/s (107mph), and gusts in the city's streets were recorded at over 40m/s (90mph), some 20% higher than the maximum windspeed previously recorded in the city. Windstorm Martin swept across central France during the night of December 27th-28th, causing windspeeds of up to 53 m/s (119 mph) along the mid-Atlantic coast and 44m/s (99 mph) inland at Clermont-Ferrand.

On the basis of RMS' modeling, Lothar is the most damaging storm to have affected France in several hundred years. RMS' extensive research on windstorms that have affected Europe over the past 500 years has revealed historical events of similar intensity to Lothar -- most notably events in 1581 and 1800 -- however no storm of this intensity is known to have passed directly over Paris, the region of highest insured exposures in France.

An RMS reconnaissance team has been surveying damage in France since the afternoon of Sunday, December 26th and reports unprecedented levels of losses. In addition to millions of downed trees and damage to national monuments, RMS has observed roof damage to more than 10 percent of buildings in the affected area. In central Paris, an estimated 60% of buildings have suffered some degree of roof damage, and in some towns in eastern France close to 100% of buildings show evidence of at least some damage.

The most significant historical insured losses from windstorms in France were caused by Windstorms Daria and Herta in 1990 (1990A and 1990D, respectively). Together these storms caused an estimated insured loss in France of 1.3 billion Euros (US$1.3 billion), and RMS' analyses suggest that Lothar and Martin will cause losses in France of at least double this amount.

Risk Management Solutions (www.riskinc.com) is the world's leading provider of products and services for the quantification and management of property catastrophe, natural hazard, and complex business risks. Its clients include leading insurers, reinsurers, industrial corporations, governments, and financial institutions. Founded at Stanford University in 1988, RMS employs over 500 people worldwide. RMS is owned by DMG Information, a division of the Daily Mail and General Trust plc media enterprise.

Note to Editors: RMS is a trademark of Risk Management Solutions, Inc.