Last month’s flooding caused an estimated €1.3 billion in damages, according to several research institutions.
The Supply Chain Intelligence Institute Austria (ASCII), the Institute for Economic Research (Wifo), and the Complexity Science Hub (CSH) reported that both individuals and businesses were affected. They noted that timely investments in flood defences helped prevent even more severe losses.
The €1.3 billion includes €700 million in damages estimated by the Insurance Association (VVO), which primarily impacts private households, ASCII Director and CSH scientist Peter Klimek and Wifo economist Klaus Friesenbichler said.
Damages from production stoppages, business inventory losses, and operational disruptions due to supply chain impacts are estimated between €300 million and €900 million, averaging €600 million. Direct damages, such as the destruction of stockpiles or business interruptions, were factored into the calculations.
Agricultural damages are estimated at €14.7 million, based on data from Austrian Hail Insurance and geodata analysis. Around 900 businesses were affected, with 676 heavily impacted, according to ASCII’s model. Damages to infrastructure, including Austrian Railways (ÖBB), weren’t included due to a lack of official data. However, experts said that a “rough estimate” incorporating infrastructure damages could bring the total to €1.8 billion.
Preventive measures taken in recent years helped limit the damage, particularly as €60 million is invested annually in flood protection. “Flood prevention has worked well,” said Friesenbichler, noting that past floods were far more destructive. The 2002 floods caused €3 billion in damages, while the 2013 floods led to €900 million in losses. The reduced impact is attributed to the construction of flood barriers, dams, and the introduction of warning systems.
However, there is still room for improvement in compensating those affected. Currently, Lower Austria’s disaster fund covers up to 80% for hardship cases. “From the public’s perspective, this is somewhat questionable,” Friesenbichler commented, adding that it reduces incentives to avoid building in flood-prone areas. While the fund is useful, relying on it for recurring damages isn’t ideal.
Friesenbichler believes an insurance solution would be more effective, with premiums reflecting flood risk – meaning those in high-risk areas would pay more. State support could help lower-income households.
Looking ahead, Friesenbichler warned that climate change is likely to make extreme weather events more frequent and severe. Prevention alone won’t be enough. “Just building dams won’t be the ultimate solution,” he said. Future planning will need to reconsider settlement and housing structures.
