Preliminary global economic losses reached US$98 billion during the first half of 2016, while global insured losses hit US$30 billion – their highest levels since 2011, according to Impact Forecasting, Aon Benfield’s catastrophe model development team.
These losses – economic and insured – were slightly below their 10-year averages of US$112 billion and US$31 billion, respectively, although they were slightly above the longer-term averages of US$84 billion and US$24 billion dating to the year 2000, said the report, titled “Global Catastrophe Recap: First Half of 2016.”
The percentage of global economic losses covered by public and private insurers was 30 percent, slightly above the 10-year average of 28 percent due to the prevalence of U.S. losses where insurance penetration is higher, Impact Forecasting said.
The report noted that the United States accounted for 47 percent of global insurance losses sustained by public and private insurance entities during the six-month period.
From an economic loss perspective, earthquake was the costliest type of disaster during first half (US$34 billion), comprising 30 percent of the loss total, mainly attributable to two powerful earthquakes that struck Japan’s Kumamoto region on April 14 and April 16.
From an insurance perspective, severe convective storm (SCS) was the costliest peril (US$12.3 billion), comprising 42 percent of the loss total, the report said.
Most of the insurable losses from SCS resulted from major thunderstorm events in the United States that prompted widespread hail, damaging straight-line winds, and tornadoes. The U.S. state of Texas alone recorded roughly 55 percent of all insured SCS losses, the report said.
Meanwhile, the report highlights that there were at least six individual billion-dollar global insured events (five of which were weather-related) during the first half of the year, and at least 22 separate billion-dollar economic loss events – including at least 20 that were weather-related, led by the U.S. (nine events), APAC (seven events), Americas (three events), and EMEA (three events).
“The first half of 2016 ended up as the costliest on an economic and insured loss basis since 2011,” said Steve Bowen, director within Aon Benfield’s Impact Forecasting team.
“The year has already been highlighted by a significant earthquake sequence in Japan, the Fort McMurray wildfire in Canada, flooding in Western Europe and a series of extensive hailstorms in the United States,” he added.
“With the pending transition to La Niña during the second half of the year, there will be a heightened focus on the risk of flooding across parts of Asia and hurricane landfall in the Atlantic Ocean basin,” Bowen affirmed.
“The financial toll of weather disasters during La Niña years has historically been among the costliest on record, and so we will wait to see whether this trend plays out in the coming months.”
Source: Aon Benfield/Impact Forecasting