Wildfires, storms made up 96% of catastrophe losses: Swiss Re

Total insured losses related to natural catastrophes exceeded $90 billion in the U.S. and Canada in 2025, according to Swiss Re's Sigma report. Secondary perils dominated these events, with severe convective storms reaching $46 billion in insured losses and wildfires producing $40 billion, or a combined 96% of the total.

Though total losses for 2025 are below that from recent years, wildfires and severe convective storms caused the highest annual aggregate insured losses ever recorded from secondary perils in North America. Swiss Re experts note that the overall insured share of losses was unusually high, at 71%.

"2025 is another clear signal that the risk landscape is shifting in ways our industry and communities across the country can't afford to treat as episodic," said Monica Ningen, CEO of U.S. property and casualty reinsurance at Swiss Re. "What stands out is not just the $90 billion in insured losses across North America, but the fact that secondary perils like wildfire and severe convective storms are now driving the overwhelming majority of that impact. These are no longer 'secondary' in any practical sense."

The Palisades and Eaton wildfires in Los Angeles were the largest loss-producing natural catastrophes of the year, and the most significant global insured wildfire loss event in Swiss Re's Sigma records. Much of the insured losses was driven by high-value and densely built wildland-urban interface areas, which Swiss Re describes as a highly populated urban area with natural vegetation.

"What is driving this trend is a combination of exposure growth and underlying risk changes. We are seeing more assets concentrated in high-risk areas, particularly in the wildland-urban interface, alongside shifts in weather patterns that increase the frequency and severity of events," said Ningen. "The result is a higher baseline level of loss, even in years that may not look extreme at first glance. That requires a mindset shift. These are not isolated shocks, but now part of the expected loss environment."

The report recommends adaptation and mitigation efforts to offset loss growth; for example, homes built to the Insurance Institute for Business & Home Safety (IBHS) Fortified mitigation program experienced a claims frequency decline of 55% to 70%, severity by 14% to 40% and loss ratios 72% lower than conventional construction.

"For insurers, this reinforces the need to be thoughtful about where and how they take risk. It starts with understanding accumulation, but it also means putting real weight behind mitigation efforts. The encouraging part is that adaptation works. When resilience measures are clear and consistently applied, whether through stronger building standards or better land-use decisions, you can see the impact in loss costs over time," said Ningen. "The reality is this only works if everyone plays a role. Homeowners, businesses, insurers and governments all have a part to play in making communities more resilient, and progress depends on those efforts being aligned."