Natural catastrophe insured losses at least $84 billion in first half: Report

Natural catastrophe activity caused at least $84 billion in insured losses in the first half of 2025, according to a report Wednesday from Gallagher Re.

The losses, driven by the high costs from the January wildfires in the greater Los Angeles metro region and elevated U.S. severe convective storm activity, were 55% higher than the average of $54 billion in the decade from 2015 to 2024.

Weather and climate events, which exclude losses associated with earthquakes, volcanoes or other non-atmospheric-driven events, caused at least $81 billion in insured losses, 59% higher than the 10-year average of $51 billion and more than first-half 2024’s $75 billion, according to Gallagher Re, the reinsurance business of Arthur J. Gallagher Co.

The January Palisades Fire in California was the most costly event, at $23 billion in insured losses, followed by the Eaton Fire, at $17 billion, the report said.

The insurance industry is “well positioned” to be able to handle such elevated losses due to “so much more capital coming into the reinsurance space,” Steve Bowen, chief science officer at Gallagher Re, told Business Insurance.

“There has been a really significant shift in mindset in terms of how the industry views the risk and how well prepared it is to absorb these increasingly expensive events,” Mr. Bowen said.

In a report this month on mid-year reinsurance renewals, Gallagher Re said dedicated reinsurance capital hit a new peak of $769 billion at year-end 2024.

The report said its figures “are preliminary and likely to change as new data emerges.”