Sigma preliminary estimates: natural catastrophes and man-made disasters in 2013 cost insurers worldwide USD 44 billion

18 December 2013, Zurich

  • Total economic losses from disasters reached USD 130 billion in 2013 worldwide
  • Insured global losses from natural catastrophes and man-made disasters totalled USD 44 billion, with flooding a major driver
  • Around 25 000 lives were lost as a result of natural catastrophes and man-made disasters in 2013

According to preliminary sigma estimates, insured losses from natural catastrophes and man-made disasters in 2013 are estimated to be around USD 44 billion, down from USD 81 billion in 2012. Insured losses from natural catastrophes are at least USD 38 billion, down from USD 75 billion, while man-made disasters generated the remaining USD 6 billion of insured claims this year, little changed from 2012.

The overall economic losses from this year's catastrophic events reached USD 130 billion, compared with USD 196 billion in 2012. The total loss of life climbed to around 25 000 from 14 000 last year.

High loss of life from Typhoon Haiyan in the Philippines
In November, Typhoon Haiyan hit the Philippines with some of the strongest winds ever recorded, heavy rains and storm surges. Haiyan has claimed more than 7 000 lives, which is the highest loss of life from a single event in 2013. Despite the devastation wreaked, insured losses are expected to be modest as insurance penetration is low in the country.

Flooding causes extensive damage across all continents
The flooding that affected large areas of central and eastern Europe in June 2013 created overall losses of USD 18 billion, with insured losses estimated at USD 4 billion. The insured losses were higher than the 2002 floods in the same region which cost the industry over USD 2 billion (USD 3 billion at current prices). The June flooding ranks as the second most expensive fresh water flood event on sigma records, but is a distant second to the 2011 Thailand flood which led to insured claims of over USD 16 billion.

Also in June, rain-induced flooding hit Alberta, Canada, causing insured losses of nearly USD 2 billion, the highest ever recorded in the country for any disaster. There were also heavy rains and floods in Australia, India, China, Indonesia, Southern Africa and Argentina this year.

European severe weather events feature prominently
In addition to floods, Europe suffered a number of other severe weather events, including hail and windstorms. Hailstorm Andreas battered Germany and France in July, resulting in insured losses of USD 3 billion. Later in the year, Windstorm Christian in central and northern Europe is estimated to have caused more than USD 1 billion in insured claims. The more recent Windstorm Xaver in the same region has triggered additional insured losses of around USD 1 billion.

Kurt Karl, Chief Economist at Swiss Re, says "In many parts of the world, insurance penetration remains low. Together with preventative measures, insurance can lessen the destructive impact and financial burden that large catastrophic events can have on people's lives. It can also help accelerate reconstruction efforts, as we have seen in areas where insurance penetration is higher."

Harsh spring and autumn weather spawned severe thunderstorms and deadly tornadoes in the US, which brought devastation of properties and hefty losses to the insurance industry. However, the 2013 North Atlantic hurricane season was benign.

Table 1: The most costly insured catastrophe losses in 2013

  Date Insured losses2
(in USDbn)
Economic losses
(in USDbn)
Event Country        
1
June 4.1
18.0
Floods Germany, Czech Republic et al. [2]
 
2 July 3.4 3.8 Hailstorm Andreas
Germany, France [2]      
3 June 1.9 4.8 Floods Canada [2]      
4 May &1.8 3.2 Severe thunderstorms, tornadoes
US [3]      
5 March 1.6 2.2 Thunderstorms, tornadoes, hail
US [3]      
6 May 1.4 2.0 Severe thunderstorms, tornadoes, large hail
US [3]      
7 October 1.4 2.7 Windstorm Christian
Germany, Denmark et al.
[4]      
8 April 1.1 1.6 Snow storm, ice, tornadoes, heavy rains
US [3]      
9 December 1.0 >1.4 Windstorm Xaver
UK, Denmark et al.
[2]      
10 January 1.0 1.5 Floods cased by Cyclone Oswald
Australia [5]      

1 The numbers in this table are subject to revision as estimate information on losses progresses/is finalised
2 Property and business interruption, excluding liability and life insurance losses
[2] Swiss Re estimate
[3] With the permission of Property Claims Services (PCS)
[4] Perils AG
[5] Insurance Council of Australia

Go to www.sigma-explorer.com to chart 2013 and historical sigma data on natural catastrophes and man-made disasters.

Notes to editors:

Definitions and selection criteria for sigma catastrophe statistics:
Natural catastrophes Loss events triggered by natural forces
Man-made disasters Loss events associated with human activities
Insured catastrophe losses Losses caused by the catastrophes covered by property insurance
Total economic losses Also include the uninsured part of the property losses related to the catastrophes
Minimum selection criteria:
Total losses USD 96 million
Or: Insured property claims Shipping: USD 19.3 million Aviation: USD 38.6 million Other: USD 48 million
Or: Casualties Dead or missing: 20 Injured: 50 Homeless: 2 000

Swiss Re

The Swiss Re Group is a leading wholesale provider of reinsurance, insurance and other insurance-based forms of risk transfer. Dealing direct and working through brokers, its global client base consists of insurance companies, mid-to-large-sized corporations and public sector clients. From standard products to tailor-made coverage across all lines of business, Swiss Re deploys its capital strength, expertise and innovation power to enable the risk-taking upon which enterprise and progress in society depend. Founded in Zurich, Switzerland, in 1863, Swiss Re serves clients through a network of over 60 offices globally and is rated "AA-" by Standard & Poor's, "Aa3" by Moody's and "A+" by A.M. Best. Registered shares in the Swiss Re Group holding company, Swiss Re Ltd, are listed on the SIX Swiss Exchange and trade under the symbol SREN. For more information about Swiss Re Group, please visit: www.swissre.com or follow us on Twitter @SwissRe

The comprehensive sigma study “Natural catastrophes and man-made disasters in 2013”will be published in Spring 2014. If you wish to pre-order a printed copy, please send your order, complete with your full postal address, to: sigma@swissre.com.