An Aon Benfield report shows that economic losses from global natural disasters for the first six months of 2014 totaled $54 billion, roughly 49% below the 10-year (2004-2013) average of $106 billion.
Insured catastrophe losses were also well below average, reaching $22 billion for the first half of the year, which is nearly 20% below the 10-year average insured loss total of $27 billion.
The Global Catastrophe Recap report uses key global natural disaster perils data from the first half of 2014, and is created by Impact Forecasting – Aon Benfield’s catastrophe model development center of excellence. The report highlights that during the six-month period around 39% of worldwide economic losses were protected by government-sponsored or private schemes, the 10-year average is 30%. This shows that a higher proportion of losses were sustained in areas with greater insurance penetration.
Associate Director and meteorologist at Aon’s Impact Forecasting department, Steve Bowen, said; “Despite some well documented natural disaster events during the first half of 2014, our data show that losses from both economic and insured perspective were each below their recent averages. However, a relatively quiet first six months does not mean a similar trend will continue throughout the rest of the year.”
The publication states that total natural disaster insurance payouts for the first-half of 2014 were $22 billion, consisting of seven individual billion-dollar insured loss events – one in Asia, two in Europe and the remaining four in the U.S. The majority of economic (32%) and insured (46%) losses were a result of severe thunderstorms, making it the most costly of perils. However, the largest economic loss event in H1 2014 was Japan’s ruthless winter weather, which totaled $6.25 billion, second to this was Southern and Eastern European flooding – with an economic loss of $4.5 billion.
Commenting on the second-half of 2014 Bowen remains wary of further huge potential losses, he said; “The third quarter historically is the costliest of natural disasters and is primarily driven by the peak of the Atlantic Hurricane Season. While the pending El Nino is likely to limit the overall number of storms in the basin, it would only take one major landfalling event to quickly make 2014 an above average year for losses – and history suggests that it is just a matter of time before the U.S. endures another major hurricane.”
You can watch Impact Forecasting senior meteorologist Steve Bowen discussing the report in the video below: