2014 insured losses 38% below average
Insured losses from natural disasters in 2014 hit $39 billion, 38 percent below the ten-year average of $63 billion and the lowest annual insured loss total since 2009.
This is according to Impact Forecasting, Aon Benfield’s catastrophe model development team, which launched its annual global climate and catastrophe report.
In 2014 there were 258 separate global natural disasters, compared to a ten-year average of 260 events. The two costliest insured loss events of the year were both a result of severe thunderstorms, in June (Europe: $3 billion) and in May (US: U$2.9 billion).
Global economic losses from natural catastrophes in 2014 stood at $132 billion, 37 percent below the ten-year average of $211 billion.
The September flood event in northern India and Pakistan resulted in the largest economic loss of the year, causing an estimated $18 billion in damage and representing the fifth consecutive year that Pakistan has registered a billion-dollar flood event.
The top three perils, flood, tropical cyclone, and severe weather, accounted for 72 percent of all economic losses during the 12 months under review, while the deadliest event of 2014 was a multi-month stretch of flash flooding and landslides that killed an estimated 2,600 people in Afghanistan.
Although around 75 percent of natural disaster losses occurred outside of the US, the territory accounted for 53 percent of global insured losses. According to Aon, this was driven by its relatively high insurance penetration.
Stephen Mildenhall, chief executive officer of Aon Analytics, said: “Global insured property catastrophes accounted for 8.6 percent of global property premium in 2014, compared to a ten-year average of 13.9 percent.
“The secular increase in catastrophe losses since 1980, which is broadly in-line with global GDP, continues to be an engine of growth for the insurance industry. With its abundant capital and sophisticated risk management tools, the industry is better positioned than ever to deliver on its core mission of providing critical risk transfer products that enable growth and development all around the world.”
Steve Bowen, associate director and meteorologist at Impact Forecasting, said: “Despite 27 individual billion-dollar natural disasters in 2014, overall economic losses were below average for a second consecutive year. The most significant losses were found in Asia, where the region sustained 57 percent of the overall economic loss and each of the top five costliest events.
“However, the United States incurred 53 percent of the global insured loss total and accounted for six of the top ten costliest insured losses of the year. The severe thunderstorm peril was the most expensive for public and private insurers as hail and damaging straight-line wind events caused multi-billion-dollar losses in the US and Europe. Historically the costliest peril, tropical cyclone losses were again below normal globally on an economic and insured loss basis following another year without a major landfalling US hurricane.”
