The world lost around $250 billion as a result of natural calamities including severe storms, with less than half of this sum covered by insurance companies.
The Munich Re (a German multinational insurance company based in Munich, Germany. It is the world’s largest reinsurer.) says this figure surpasses the 10-year average, accounting for catastrophic losses resulting from earthquakes in Turkey and Syria.
Although the United States experienced a less severe hurricane season than in 2022, insured losses from regional thunderstorms were more significant.
Ernst Rauch, Munich Re’s chief climatologist and geologist, emphasized the need for insurance companies to reconsider their classification of storms. The changing climate, marked by 2023 being the hottest year on record, is altering weather patterns, leading to increased risks. Rauch explained that the rise in temperatures causes more water to evaporate, providing energy for severe storms.
Insured losses from severe thunderstorms, characterized by heavy rain, high wind speeds, hail, and flash floods, reached $50 billion in the United States and $8 billion in Europe during 2023, setting records. Europe experienced significant losses, including billions of dollars in damages from large hailstones in northern Italy and other regions.
While hurricane-related losses were limited, the devastating earthquakes in southeastern Turkey and Syria in February contributed $50 billion to the total losses, of which only $5.5 billion were insured. Scientists predict that 2024 will be hotter than the previous year, increasing the likelihood of more extreme weather events and reinforcing the challenges faced by insurers and governments in handling climate-related claims.