Insured Losses Due to Natural Disasters Reach a 10-Year High

wild fire

By David DeMoss

Fires, and snow storms, and floods, oh my! With climate change, comes extreme weather. And with extreme weather, comes natural disasters that affect millions of people worldwide. In unfortunate news, insured losses just hit a 10-year high, and we’re only halfway through 2021.

See below for an article from Insurance Journal, that takes a deep dive into these losses.

Insured losses from natural disasters hit a 10-year high of $42 billion in the first half of 2021, with the biggest loss related to extreme cold in the United States in February, insurance broker Aon said on July 21.

Overall economic losses came in below their 10-year average, however, at $93 billion, Aon said in a report.

Disasters which hit developed countries typically lead to greater insured losses. Seventy-two percent of global insured losses occurred in the United States in the first half of 2021, Aon said.

The Polar Vortex-induced period of extreme cold there led to an insured loss of at least $15 billion.

Major storms in western and central Europe in June caused at least $4.5 billion in insured losses, Aon said.

Floods in Europe in mid-July have likely caused $2-3 billion in reinsurance losses, analysts say. Natural disasters were responsible for around 3,000 deaths globally in the first half, with 800 fatalities from the heatwave which hit parts of Western Canada and the U.S. Pacific Northwest in late June.

“The juxtaposition of observed record heat and cold around the globe highlighted the humanitarian and structural stresses from temperature extremes,” said Steve Bowen, managing director and head of catastrophe insight on the Impact Forecasting team at Aon.

Bowen added that as a result of climate change, “it becomes more imperative to explore ways to better manage the physical and non-physical risks that are more urgently requiring actionable solutions.”

On July 21, British insurer Aviva called for urgent action from policymakers, developers and insurers to protect homes and businesses from the impact of climate change, saying most were ill-prepared to handle extreme weather.

To read the original source, click here.