Swiss Re has published some early figures on the amount of economic and insured losses suffered during 2010 from natural catastrophes and man-made disasters around the world. According to Swiss Re’s sigma team, early estimates put worldwide economic losses from natural catastrophes and man-made disasters at a massive $222 billion in 2010 with insured losses at $36 billion.
Those are high figures, particularly when you compare to last year. In 2009 worldwide economic losses were only $63 billion and insured losses were 34% less than during 2010. Swiss Re also note that 2010 has seen the highest level of mortality from natural catastrophes and man-made disasters with an estimated 260,000 deaths. With a month left during 2010 it’s feasible to assume those figures will rise a little as well.
Natural catastrophes have cost the global insurance industry approximately $31 billion during 2010 and man-made disasters have cost around $5 billion. Total insured losses in 2009 were $27 billion. Earthquake claims were notably higher than average, says Swiss Re, but the benign Atlantic hurricane season meant that total losses were actually in line with the average.
There have been eight events which have triggered insured losses of over $1 billion so far this year. The costliest event was the Chilean earthquake with losses of $8 billion. Next costliest was European windstorm Xynthia at $2.8 billion and after that the New Zealand earthquake at $2.7 billion. On the man-made disaster side, the BP Deepwater Horizon oil spill is currently estimated at $1 billion although that does have the potential for losses to grow.
Interestingly, despite the hurricane season having little impact on the U.S., the fourth and fifth most costly insured catastrophe losses of 2010 are windstorms in the United States during April and May. So the U.S. did not escape windstorm losses completely and with the combined insured loss of these two storms estimated at $3.58 billion perhaps insurers should be taking a look at how to transfer the risks of those kind of windstorms to the capital markets through catastrophe bonds?
Read more in the Swiss Re press release.