Swiss Re Ltd
Severe thunderstorms drive insured losses to USD 60 billion in first half of 2024, Swiss Re Institute estimates
Swiss Re Ltd
/ Key word(s): Research Update
Zurich, 7 August 2024 – A high frequency of small to medium events resulted in global insured losses from natural catastrophes of USD 60 billion in the first half of 2024, according to Swiss Re Institute’s preliminary estimates. Severe thunderstorms, mainly in the US, accounted for 70% of global insured losses. Balz Grollimund, Head of Catastrophe Perils at Swiss Re, said: "In recent years, severe thunderstorms have emerged as a main driver of a significant increase in insured losses. This is due to growing populations and higher property values in urban areas, along with insured property being more vulnerable to hail damage. Therefore, multi-billion-dollar loss events from this peril are likely to become more common." Thunderstorms or severe convective storms (SCS) are characterised by strong winds including tornadoes, hail and heavy rain. In total, these led to insured losses of USD 42 billion globally in the first half of 2024. In the US, 12 storms each caused losses of USD 1 billion or more, demonstrating the loss potential of this peril. According to Swiss Re Institute's sigma 1/2024, insured losses from SCS in the US have increased by around 8% in nominal terms annually since 2008. Jérôme Jean Haegeli, Swiss Re's Group Chief Economist, said: "Insured losses from severe thunderstorms have been growing due to a mix of factors including inflation, which has contributed to rising construction costs. And, with economic development, overall exposures will continue to increase. That's why investing in protective measures – such as shielding vulnerable communities from floods or improving building codes to protect homes from severe hailstorms – is vital." Floods also caused above-average losses, driven by events in the UAE, Germany and Brazil, and accounted for 14% of global insured losses. In April, torrential rain caused by severe thunderstorms led to flash floods on the Arabian Peninsula, resulting in unprecedented damage in the UAE. According to industry estimates, insured losses will likely amount to at least USD 2 billion, making it the country's costliest natural disaster on record. While heavy rainfall is expected to increase in a warmer climate, swift urban growth, land use alteration, scarce drainage systems, and dry soils intensify loss severity. Total economic and insured losses in H1 2024 and H1 2023
Note: H1 previous 10-year average refers to the average first-half losses between 2014 and 2023. Preliminary and, due to rounding, some totals may not correspond with the sum of the separate figures.
Disclaimer Although all the information discussed herein was taken from reliable sources, Swiss Re does not accept any responsibility for the accuracy or comprehensiveness of the information given or forward-looking statements made. The information provided and forward-looking statements made are for informational purposes only and in no way constitute or should be taken to reflect Swiss Reʼs position, in particular in relation to any ongoing or future dispute. In no event shall Swiss Re be liable for any financial or consequential loss or damage arising in connection with the use of this information and readers are cautioned not to place undue reliance on forward-looking statements. Swiss Re undertakes no obligation to publicly revise or update any forward-looking statements, whether as a result of new information, future events or otherwise.
About Swiss Re The Swiss Re Group is one of the world's leading providers of reinsurance, insurance and other forms of insurance-based risk transfer, working to make the world more resilient. It anticipates and manages risk – from natural catastrophes to climate change, from ageing populations to cybercrime. The aim of the Swiss Re Group is to enable society to thrive and progress, creating new opportunities and solutions for its clients. Headquartered in Zurich, Switzerland, where it was founded in 1863, the Swiss Re Group operates through a network of around 80 offices globally.
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