Insured losses from natural catastrophes and man-made disasters will total $65 billion for 2012, according to preliminary estimates by Swiss Re sigma research. Natural catastrophes accounted for more than 11,000 lives lost and $60 billion in insured claims.
In the second half of 2012, Superstorm Sandy and wide spread drought in the United States led to total economic losses from disasters more than $140 billion. Insured losses resulting from catastrophes could reach $65 billion, compared to insured losses of more than $120 billion last year due to record earthquakes and flooding.
"Severe weather events continue to affect many parts of the world,” said Kurt Karl, Swiss Re’s Chief Economist. “Although insurance cannot bring back lost lives, many people and businesses can rely on financial relief from insurance cover, as is the case for the U.S. However, in large parts of the globe that are prone to severe weather events, people and businesses could increase risk-preparedness by eliminating underinsurance."
Table 1: The most costly insured catastrophe losses in 2012
|1||$20 to $25||Oct/Nov||Hurricane Sandy||U.S. |
|3||$2.50||March||Severe storms, tornadoes||U.S.|||
|4||$2.30||April||Severe storms, tornadoes||U.S.|||
|||Property and business interruption, excluding liability and life insurance losses|
|||Swiss Re estimates|
|||With the permission of Property Claims Services (PCS)|
Weather-related events in the United States caused the most economic losses for the year, and all of the top five insured loss events were in that country, including Sandy, which in terms of wind span was the largest Atlantic hurricane on record. A record storm surge resulted and caused widespread flood damage to densely populated areas on the East Coast and led to the worst power outage caused by a natural catastrophe in U.S. history, Swiss Re said. Sandy also struck the Caribbean and the Bahamas, causing loss of lives and property. Insured loss estimates related to that storm are now between $20 billion and $25 billion. However, the total insured loss tally is subject to revision.
Extremely dry weather and limited snowfall led to one of the worst droughts in recent decades, affecting more than half of the United States and drought-related agricultural losses likely will reach $11 billion, including pay-outs from federal assistance programs, Swiss Re said.
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