4/10/2018 11:46:00 AM
Global insured losses from disaster events last year totaled $144 billion, Swiss Re Ltd. said Tuesday, the highest ever recorded in a single year.
The Swiss Re Institute’s recent sigma report, which is marking its 50th anniversary this year, also found that total global economic losses from natural disasters and man-made catastrophes reached $337 billion last year, almost double the losses in 2016 and the second-highest on record.
Wind damage and flooding from the active hurricane season in the U.S. caused over $217 billion — or 60% — of the damage, with 42% was covered by insurance, the report said, leaving taxpayers and governments to mostly pick up the cost.
The highest losses came from hurricanes Harvey, Irma and Maria that struck the U.S. and the Caribbean in quick succession and resulted in combined insured losses of $92 billion, equal to 0.5% of U.S. gross domestic product. The hurricanes made 2017 the second-costliest North Atlantic hurricane season since 2005.
The hurricanes highlighted the much wider problem of flood risk in the U.S., Swiss Re said, with floods causing, on average, economic losses of $15 billion annually, of which only $5 billion is insured. Many of the nation’s insurers don’t currently offer flood policies due to the unpredictable nature of floods, Swiss Re said, but this is changing.
Swiss Re said flood models have evolved to where flood-risk assessments of each individual home are being replaced by tools such as satellite imaging, digital elevation models and disaster simulations.
“These new technologies have the potential to be a true game changer in how we manage flood risk, saving Americans billions of dollars annually and making us more effective against a peril once thought ‘uninsurable,’” Swiss Re said in a statement.
More than 11,000 people died or went missing in natural and man-made disasters in 2017, the report said, more than in 2016 but still one of the lowest in a single year, according to sigma records. Globally, there were more than 8,000 victims of natural catastrophes in 2017.
Man-made disasters, including major fires, explosions, and terrorism, resulted in roughly 3,000 deaths, compared with around 4,000 in 2016. The total number of victims from terrorism was 731, up from 601 in 2016.
Last year was also record year for wildfires, Swiss Re said. Insured losses from all wildfires in the world totaled $14 billion in 2017, the highest ever in a single year.
“One significant trend is longer wildfire seasons, defined as the time between the first discovery and last control of a wildfire,” the report said. “On average, wildfire seasons in 2003-2012 were around 84 days longer than in 1973-1982.”