Heatwave health risks threaten insurer earnings, rating agency S&P warns
The rating agency S&P has warned that Europe's intense heatwaves could squeeze insurers' earnings, as life and health insurers face a growing wave of claims linked to heat-related deaths and worsening health conditions, particularly among older people. This matters because insurers may respond by raising premiums for customers, and because the trend is expected to worsen as summers become hotter and Europe's population continues to age, potentially affecting the credit ratings of insurers and reinsurers over the medium to long term.
S&P noted that between 2004 and 2024 the proportion of EU residents aged 65 and over rose from 16.4% to 21.6%, with those aged 80 and over increasing from 3.8% to 6.1%, leaving more people vulnerable to heat stress. During the 22-28 June heatwave, roughly 9,000 of 10,650 excess deaths recorded were among those aged 65 and over, while in the UK the May and June heatwaves caused 2,877 excess deaths, up from 1,504 in summer 2025. Temperatures exceeded 40C in parts of Europe this month, breaking records in Slovakia, Austria and Hungary, and a recent Lancet Planetary Health study found that people aged 60 and over are endangered by lower heat levels than previously assumed.
- S&P warns heatwaves may raise insurers' claims and premiums.
- Older Europeans face rising heat-related death and illness risks.
- Recent heatwaves caused thousands of excess deaths across Europe and UK.
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Europe has been hit by repeated, intense heatwaves in recent years, with record temperatures recorded in several countries. Because older people are especially vulnerable to extreme heat, and Europe's population is ageing, more people are dying or falling seriously ill during these periods than in the past, generating a growing number of insurance claims.
S&P is a major credit rating agency, which assesses the financial strength of companies, including insurers, and assigns them ratings that reflect how likely they are to meet their obligations. Insurers matter here because they sell life and health policies that pay out when customers die or need medical care, so a rise in heat-related deaths and illness feeds directly into their costs.
This matters because a sustained increase in claims can affect insurers' profits, their pricing decisions and, potentially, the credit ratings that investors and regulators rely on. It also has knock-on effects for ordinary customers, since insurers facing higher costs may pass these on through higher premiums.