Claims for weather-related incidents are projected to surpass $100 billion for the third consecutive year as floods, hailstorms, and wildfires linked to climate change continue to escalate in frequency. Munich Re estimates that global insured costs for natural-catastrophe events in the first half of 2023 reached $43 billion, while Swiss Re places the figure at $50 billion.
Severe thunderstorms in the United States accounted for more than two-thirds of the insured losses. Despite this, the $100 billion threshold is on track to be reached, even though only $5 billion of the $40 billion in damages caused by this year's most devastating event — the earthquake in Turkey and Syria with an estimated death toll of 58,000 — was insured. Furthermore, the full US hurricane season, which runs until the end of November, is yet to conclude. Swiss Re also noted that it has already experienced some limited insured losses resulting from the summer heatwaves in Europe and the US, which will be accounted for in their second-half results.
In 2022, insured losses from natural catastrophes amounted to $125 billion, compared to an average cost of $81 billion over the past decade and $110 billion over the last five years. However, the increase in claims does not necessarily spell detrimental news for insurers. Swiss Re, for example, reported an increase in net income for the first half of the year, as the company contained its losses from natural disasters and witnessed greater demand for coverage due to past calamities, even as policy prices rose.