Global Insured Catastrophe Losses Estimated At $112 Bln In FY21

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Global insured catastrophe losses in the year 2021 is expected to rise to $112 billion, the fourth highest on record, with Hurricane Ida being the main loss-making event, according to an estimate by Swiss Re Institute.

Going ahead, it is expected that natural catastrophe losses would continue to grow more than global GDP, with increases in wealth, urbanization and climate change.

The annual insured catastrophe losses include estimated insured losses from natural catastrophes of $105 billion, the fourth highest since 1970, as well as insured losses from man-made disasters of $7 billion.

Meanwhile, these sigma catastrophe loss estimates are for property damage and exclude claims related to COVID-19.

Extreme weather events in the year, including a deep winter freeze, floods, severe thunderstorms, heatwaves and a major hurricane, resulted in annual insured losses from natural catastrophes.

According to the Institute's preliminary sigma, Hurricane Ida was the costliest natural disaster in 2021, while winter storm Uri and other secondary peril events caused more than half of total losses. Wealth accumulation and climate change effects in disaster-prone areas drive claims.

The two costliest natural disasters of the year were both recorded in the U.S. Hurricane Ida wreaked $30 to $32 billion in estimated insured damages, including flooding in New York, and winter storm Uri caused brought extreme cold, heavy snowfall and ice accumulation, especially in Texas.

The costliest event in Europe meanwhile was the July flooding in Germany, Belgium and nearby countries, causing up to $13 billion in insured losses, in comparison with economic losses of above $40 billion.

Martin Bertogg, Head of Cat Perils at Swiss Re, noted that insured losses from natural disasters in 2021 again exceeded the previous ten-year average, continuing the trend of an annual 5-6% rise in losses seen in recent decades.

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