A series of winter storms in Europe, unprecedented flooding in Australia and South Africa as well as a high number of thunderstorms in the US and Europe resulted in USD 35 billion of insured losses from natural catastrophes in the first half of 2022, according to Swiss Re Institute’s preliminary estimates (see 5 Largest Natural Catastrophes. Weather-related Events in the 1H2022 Drove $65 bn Economic Losses).
Man-made events triggered an additional USD 3 billion in insured losses, bringing total catastrophe insured losses to USD 38 billion. The record-high temperatures in many parts of Europe may lead to further losses caused by droughts and wildfires. The severe weather events of the past six months once again highlight that natural catastrophes, particularly secondary perils, are increasing in frequency and severity in all regions.
- Global estimated insured losses from natural catastrophes in first half of 2022 at USD 35 billion, 22% above average of past ten years (USD 29 billion)
- Floods in Australia set new record for insured flood losses at close to USD 3.5 billion, the costliest natural catastrophe for the insurance industry in the first half of 2022
- Secondary perils such as hailstorms and flooding continue to drive insurance losses globally, exacerbated by rapid urban development and wealth accumulation in disaster-prone areas
Martin Bertogg, Head of Catastrophe Perils at Swiss Re, said: “This confirms the trend we have observed over the last five years, that secondary perils are driving insured losses in every corner of the world. Unlike hurricanes or earthquakes, these perils are ubiquitous and exacerbated by rapid urbanisation in particularly vulnerable areas. Given the scale of the devastation across the globe, secondary perils require the same disciplined risk assessment as primary perils such as hurricanes.”
The effects of climate change are evident in increasingly extreme weather events, such as the unprecedented floods in Australia and South Africa.
In February, a series of winter storms hit Europe and prompted estimated insured losses of USD 3.5 billion, bringing this key peril back on the insurance industry’s agenda. In February and March, torrential rains led to widespread flooding in Australia. It set a new record for flood losses in the country at so far close to USD 3.5 billion. For the insurance industry, this is one of the costliest natural catastrophes ever in the country and the costliest event globally in the first half of 2022, in terms of insured losses. Floods in South Africa as well as in India, China and Bangladesh further confirm the growing loss potential from floods in urbanized areas globally.
In the first half of 2022, severe weather including hailstorms and heavy rain hit France, so far causing an estimated EUR 4 billion of insured market losses, based on data from the French Federation of Insurance Companies.
Total economic and insured losses in H1 2022 and H1 2021
(USD billion in 2022 prices)
|H1 2022||H1 2021||H1 previous 10-y avg||% change|
vs 10-y avg
Preliminary and, due to rounding, some totals may not correspond with the sum of the separate figures.
Two severe summer heatwaves resulting in record-high temperatures across Europe have sparked destructive forest fires across southwest Europe. The global average temperature for June 2022 was about 0.3°C higher than the 1991-2020 average, making it the third warmest June on record. As warming climate is predicted to exacerbate droughts, the likelihood of wildfires increases, causing greater damage where rapid urban sprawl overlaps the wildland-urban interface.
Climate change is one of the biggest risks our society and the global economy is facing. With 75% of all natural catastrophes still uninsured, we see large protection gaps globally exacerbated by today’s cost-of-living crisis. Partnering with the public sector, the insurance industry is critical for strengthening society’s resilience to climate risks, by investing in and underwriting sustainable infrastructure.Jérôme Jean Haegeli, Swiss Re’s Group Chief Economist
Global economic losses from natural and man-made catastrophe events are estimated at USD 75 billion in the first half of 2022. This is below the average of the past ten years (USD 80 billion).