Total economic losses from natural catastrophes were estimated at $72 billion in the first half of 2022, fueled by storms and flooding, Swiss reinsurance giant Swiss Re estimated on Tuesday.
While the figure is below the estimate of $91 billion for the first six months of 2021, it is close to the 10-year average of $74 billion and the weight is shifting toward weather-related disasters.
“The effects of climate change are evident in increasingly extreme weather events such as the unprecedented floods in Australia and South Africa,” said Martin Bertogg, Swiss Re’s Head of Catastrophe Risks.
The Zurich group, which acts as an insurer to insurers, said the damage was also being driven by winter storms in Europe, as well as severe thunderstorms in the continent and the United States.
So-called secondary natural catastrophes like floods and storms — as opposed to larger catastrophes like earthquakes — are more common, the reinsurer said.
“This confirms the trend we have observed over the past five years: that secondary perils are driving insured losses in all parts of the world,” Bertogg said.
“Unlike hurricanes or earthquakes, these dangers are pervasive and are exacerbated by rapid urbanization in high-risk areas,” he said.
“Given the magnitude of devastation around the world, secondary hazards require the same disciplined risk assessment as primary hazards such as hurricanes.”
According to Swiss Re, the floods in India, China and Bangladesh confirm the growing damage potential from flooding in urban areas.
Man-made disasters such as industrial accidents added another $3 billion in economic losses to the $72 billion from natural disasters, bringing the total to $75 billion — down from $95 billion in the first half 2021 lies.
– Insured losses at $38bn –
Total insured losses were $38 billion: $3 billion worth of man-made catastrophes and $35 billion worth of natural catastrophes — a 22 percent increase from the 10-year average, the said Swiss reinsurer and warned of the effects of climate change.
February’s storms in Europe cost insurers $3.5 billion, according to Swiss Re estimates.
The Australian floods in February and March set a new record for insured flood claims in the country to date, at almost US$3.5bn – one of the costliest natural catastrophes the country has ever seen.
Severe weather and hailstorms in France have caused an estimated €4bn ($4.1bn) in insured market losses in the first six months of the year to date.
The Swiss group also mentioned the summer heatwaves in Europe, which led to fires and drought-related damage, without providing any estimates at the time.
A warming climate is likely to exacerbate droughts and thus the likelihood of wildfires, and cause greater damage where urban sprawl is growing into the countryside, Swiss Re said.
“Climate change is one of the greatest risks facing our society and the global economy,” said the group’s chief economist Jerome Jean Haegeli.
“With 75 percent of all natural catastrophes still uninsured, we see large protection gaps around the world that are being exacerbated by today’s cost-of-living crisis.”
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