With the US enduring two major hurricanes and numerous severe thunderstorms in 2024, it has contributed to at least two-thirds of the estimated global insured losses for the year, which exceed $135 billion, according to a new report from Swiss Re.
Hurricane Helene, which made landfall on the 27th of September, was followed by Hurricane Milton on the 9th of October, with insured losses from both hurricanes expected to total less than $50 billion as per Swiss Re.
2024 additionally experienced a high frequency of severe thunderstorms (severe convective storms, or SCS), which again reportedly affected mostly the US.
“Insured losses from SCS are expected to add more than $51 billion globally for 2024 as of today, the second-highest loss after the record high of approximately $70 billion in 2023,” Swiss Re’s report explained.
Meanwhile, severe floods in Europe and the UAE are said to have resulted in estimated insured losses of close to $13 billion.
“It was the third-costliest year for this peril globally and the second costliest for Europe which experienced insured losses of approximately $10 billion,” Swiss Re’s report added.
Namely, Storm Boris caused major floods in Central Europe in 2024, mainly affecting the Czech Republic, Poland, and Austria, with additional impacts reported in Slovakia, Romania, Italy, and Croatia.
In October, large parts of Spain also experienced heavy rainfall, flash floods, and hailstorms, causing severe damage, with the worst floods occurring in eastern and southern Spain, particularly across the Valencia and Castilla-La Mancha regions.
For this event, Morningstar DBRS pegged insured losses at €4 billion-plus. At the same time, S&P noted that the floods will have “limited effects” on private insurers and reinsurers, given that the Consorcio de Compensación de Seguros (CCS), the institution attached to the Ministry of Economy, Trade, and Business, will cover most of the claim costs.
Commenting on the subject of flooding, Jérôme Jean Haegeli, Swiss Re’s Group Chief Economist, said, “Economic development continues to be the main driver of the rise in insured losses resulting from floods, but also other perils, seen over many decades.
“However, with natural catastrophe risks rising and higher price levels, the annual increase of 5–7% in insured losses will continue, and protection gaps could remain high. This highlights the need for adaptation in combination with an adequate insurance coverage that can support financial resilience.”
Speaking more broadly on the $135 billion global insured loss estimate, Balz Grollimund, Swiss Re’s Head of Catastrophe Perils, observed, “For the fifth consecutive year, insured losses from natural catastrophes break the USD-100-billion mark.
“Much of this increasing loss burden results from value concentration in urban areas, economic growth, and increasing rebuilding costs.
“By favouring the conditions leading to many of this year’s catastrophes, climate change is also playing an increasing role. This is why investing in mitigation and adaptation measures must become a priority.”
Gallagher Re recently revealed that for the first 9 months of 2024, losses covered by the private insurance market or public insurance entities totalled at least $108 billion, 5% higher than the decadal average of $102 billion.
Global broking group Aon has also estimated insured losses from natural catastrophe events in the first 9 months of 2024 to be at least $102 billion, with the impacts of Hurricane Milton and additional events expected later in the year likely to push annual insured losses above the $125 billion recorded in 2023, in line with Swiss Re’s view.
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