Global insurer Munich Re estimates that global insurance losses from natural disasters reached $34 billion in the first half of 2022, with half of economic losses realized.
Munich Re forecasts financial losses due to natural disasters at $65 billion in the first half of 2022, down from the $105 billion seen in H1 2021.
With $34 billion covered by insurance and reinsurance in H1 2022, almost the same figure as in the previous year, it means that Munich Re sees the difference in insurance protection around the world to be much smaller this year, which is probably a function of location and types of unfortunate losses. measure.
Munich Re ranks the natural risk insured for the first half as average for this part of the year.
Munich Re’s figures pale in comparison to insurance and reinsurance broker Aon, which recently said its H1 tally will be around $39 billion, which is 18% above average, according to the broker’s estimate.
But Aon also put the global economic damage from natural disasters at 24% below the H1 estimate, at $92 billion.
Reflecting the difference in how the two companies allocate disaster losses, it appears that Aon includes more of the impact of bad weather than Munich Re, resulting in a higher financial risk.
Diversification, where Munich Re places the burden as between the insurance and insurance companies, it is already clear that some businesses are affected by their financial performance from the first serious damage.
Torsten Jeworrek, member of the Board of Management at Munich Re, commented on the losses for the first half, “The picture of natural disasters for the first half of 2022 is dominated by climate-related disasters. Hurricanes in the US cost billions, Australia’s east coast was inundated by floods, and southern Europe struggled with extreme heat, wildfires and drought. A recently published IPCC report warned of the need for insurers to change their loss policies in order to improve change in risk. Loss prevention is an important part of mitigating the economic impact of climate change. It is therefore of great concern that the penetration of insurance in developing and developing countries is decreasing by 10 percent, and that even in rich countries there are a lot of room for improvement.”
Munich Re puts the damage from the floods in Australia since February at $3.7 billion in lost prices, while the March 2022 Japan earthquake is estimated at $2.8 billion. APAC contributed $8 billion in insured losses for H1.
The US dominated insurance losses, with almost two-thirds coming from the country, at $19 billion.
In fact, for the first half of the year alone, Munich Re estimates that US hurricanes cost $22 billion in assets, with $17 billion being insured.
Hurricanes in Europe caused the most damage, at $5.2 billion, while recent heatwaves, wildfires and droughts in Europe are not comparable, but Ernst Rauch, Chief Climate Scientist at Munich Re, and head of the Climate Solutions Unit said, ” “Hot days become hot days, what used to be hot become very hot days. Drought and wildfires are the direct result.”
Europe contributed $7 billion in insured losses for H1.
Rauch summarized the climate disasters of the first half of the year, “They can always be individual events for different reasons, but when they are put together, one thing is clear: the strong influence of climate change is very evident! And the impact on people around the world is increasing. The IPCC has also made a clear statement, saying that climate-related disasters such as heat waves, storms or droughts on a warming Earth will increase in frequency and intensity. Clocks can last longer and bring more heat. This will vary by region – in Europe it will be the south that is most affected. “