Natural catastrophes caused global insured losses of $105 billion in 2021—the fourth highest since 1970, according to Swiss Re Institute’s preliminary sigma estimate. This was up from $90 billion in 2020 and a sharp increase from the 10-year average of $77 billion.
Man-made disasters triggered another $7 billion in insured losses, Swiss Re said, resulting in estimated global insured losses of $112 billion from catastrophes in 2021.
The two costliest events of 2021 took place in the U.S. Hurricane Ida caused $30-$32 billion in estimated insured damage, including flooding in New York. Winter storm Uri caused $15 billion in insured losses, bringing extreme cold, heavy snowfall and ice accumulation. Texas was hit especially hard by this storm, with the power grid experiencing multiple failures due to freezing conditions.
Swiss Re Group Chief Economist Jérôme Jean Haegeli stressed the importance of investing in strengthening critical infrastructure, adding that “in the U.S. alone, the infrastructure investment gap to maintain critical and aging infrastructure is $500 billion on average per year until 2040.”
The costliest event in Europe was the July flooding in Germany, Belgium and nearby countries, causing up to $13 billion in insured losses and economic losses of more than $40 billion. Swiss Re noted that the flooding was the costliest natural disaster for the region since 1970.
Europe also saw severe convective storms in June, with thunderstorms, hail and tornadoes causing widespread damage to property in Germany, Belgium, the Netherlands, Czech Republic and Switzerland. The resulting insured losses are estimated at $4.5 billion.
Meanwhile, Canada, the U.S. and parts of the Mediterranean also experienced record high temperatures in 2021. For example, in late June, a “heat dome” set a new all-time Canadian temperature record of nearly 121 degrees Fahrenheit (50 C) in a village in British Columbia, while temperatures in Death Valley, Calif., reached 130 F (54.4 C) during a heatwave in July.
Swiss Re noted that these sigma catastrophe loss estimates are for property damage and exclude claims related to COVID-19. The loss estimates are preliminary and are subject to change as not all loss-generating events have been fully assessed yet.
Source: Swiss Re Group