El Niño heightens South Africa fire, insurance risks
A strengthening El Niño is raising the risk of extreme heat, drought and veld fires across South Africa, increasing the likelihood of heavier weather-related losses for insurers during the 2026/27 summer season. The South African Weather Service has warned that the Pacific warming event is already strong and could intensify further, with sea-surface temperature anomalies in the east-central…
A powerful El Niño is causing heightened concerns over fire and insurance risks in South Africa for the upcoming 2026/27 summer season. The South African Weather Service has issued a warning that this Pacific warming event may grow even stronger, with sea-surface temperature anomalies in the east-central tropical Pacific surpassing the criteria for a "very strong" El Niño.
The World Meteorological Organization has confirmed the El Niño's establishment and predicts it will persist until February 2027, with a near-100 percent probability.
This event enhances the likelihood of extreme heat, drought, and veld fires across the country, potentially leading to heavy weather-related losses for insurers during the season. South Africa's typical El Niño pattern involves reduced summer rainfall and high temperatures. While the 2025/26 summer was better due to above-normal rainfall, the winter-rainfall zone has encountered shortages.
Insurance companies are facing challenges due to the increasing frequency and severity of weather-related catastrophes, including fires, storms, and drought. In addition to direct damage from these events, insurers must also contend with business interruption, agricultural losses, infrastructure failures, and higher repair costs. Cedric Masondo, CEO of PSG Insure, notes that weather-related catastrophes have become the primary driver of short-term insurance claims costs in the first half of 2026.
The shift from a wetter La Niña pattern to a drier El Niño summer is especially crucial for wildfire risk. Drier vegetation, combined with higher temperatures and lower rainfall, can create rapid fire spread, though forecasters stress that El Niño does not predict specific locations or timing of damaging events. Moreover, underinsurance remains a concern, with EY identifying climate-driven catastrophes, aging infrastructure, and elevated claims costs as ongoing challenges for South African insurers. Higher premiums are incentivizing some policyholders to lower their coverage.
Agriculture faces a similar affordability issue, particularly for smaller producers. Specialists are urging businesses and farmers to adopt practical adaptation measures such as firebreaks, drought-resistant planting, water management, and stronger infrastructure, as insurance alone cannot prevent physical disruption or guarantee full coverage.
This uncertainty is evident in North West Province, where fire authorities warn that the current season could become exceptionally severe, with over 1.6 million hectares of veld and farmland potentially exposed to fire risk as El Niño conditions intensify.
Written by urgent.news from Arabian Post's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
