2023 to top $100B in insured natural catastrophe losses: Swiss Re

Record severe convective storm losses estimated at $60 billion are driving what will become the fourth consecutive year with more than $100 billion in insured natural catastrophe losses, according to a report released Thursday by Swiss Re Ltd.

The U.S., which is particularly prone to severe convective storms due to its geographical location, has had 18 events year to date which each caused insured losses of $1 billion or more, the report said.

The U.S. this year for the first time surpassed $50 billion in insured losses for severe convective storm activity, and that total  “is set to keep rising,” the report said.

Losses from severe thunderstorms have steadily increased by 7% annually during the past 30 years. This year’s losses are an increase of almost 90% compared with the previous five-year average of $32 billion in losses and more than double the previous 10-year average of $27 billion, the report said.

The earthquake in Turkey and Syria in February is the costliest natural catastrophe of 2023, with insured losses of $6 billion.

New Zealand saw $2.4 billion in insured damages from floods and cyclones, which caused the costliest weather-related insured losses in its history.

The wildfires on Maui are estimated to become the costliest insured loss event ever for the state of Hawaii, with $3.5 billion in insured losses, the report said.

Jérôme Jean Haegeli, Swiss Re group chief economist, called the losses an “earnings’ test” for primary insurers. 

“The cumulative effect of frequent, low-loss events, along with increasing property values and repair costs, has a big impact on an insurer’s profitability over a longer period,” he said.