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Flooding drives nat cat insured losses globally in first half of 2013: Swiss Re


August 21, 2013   by Canadian Underwriter


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Flooding was the main driver in insured losses from natural catastrophes that amounted to US$17 billion for the first half of 2013, note preliminary sigma estimates released by Swiss Re.

Flooding drives nat cat insured losses globally in first half of 2013: Swiss Re

The global insurance industry covered US$20 billion of total losses in the first six months of 2013, notes a statement from Swiss Re.

Of that total, US$17 billion was related to natural catastrophes (loss events triggered by natural forces) that claimed approximately 7,000 lives and US$3 billion was attributable to man-made disasters (loss events associated with human activities).

The 2013 half-year total for nat cat losses was less than the US$21 billion for the first half of 2012 (and below the average of the last 10 years), while man-made disaster losses for the first six months of both 2013 and 2012 remained unchanged at US$3 billion.

“Though 2013 has so far been a below-average loss year, the severity of the ongoing North Atlantic hurricane season, and other disasters such as winter storms in Europe, could still increase insured losses for 2013 substantially,” Kurt Karl, chief economist for Swiss Re, says in the statement.

Swiss Re reports that natural catastrophe insured losses around the world for the first half of 2013 were, in large part, due to flood events. These losses amounted to an estimated US$8 billion, already making 2013 the second most expensive calendar year for insured flood losses on sigma records. That record remains 2011, when the Thailand event alone brought flood losses of more than US$16 billion.

Flood losses occurred around the world, including in June in Alberta. Rains and subsequent flooding generated insured losses estimated at US$2 billion, which would be the highest insured loss ever recorded in Canada.

The same month, heavy rains in central and eastern Europe caused massive floods that resulted in an estimated US$4 billion cost for the insurance industry. Swiss Re reports that the total would make the flooding the second most expensive fresh water flood event on sigma records.

And in January, Cyclone Oswald brought flood damage to Australia that resulted in insured losses of US$1 billion.

There was also large-scale flooding during the first half of 2013 in southern Africa, Indonesia, Argentina and India, the last event resulting in the deaths of 1,150 people (many more people are still missing).

“Flooding continues to wreak havoc across all areas of the world,” Jens Mehlhorn, head of flood risk at Swiss Re, says in the statement. “While we cannot stop future floods, we believe that preventative actions can be taken to mitigate the overall impact of extreme weather events,” Mehlhorn adds.

Overall, preliminary estimates indicate that total economic losses from natural catastrophes and man-made disasters amounted to US$56 billion for the first six months of 2013, down from US$67 billion for the same period in 2012.

A chart included in the Swiss Re press release lists the most expensive insured losses during the first half of 2013. Among other things, the chart lists estimated economic losses as the following: US$18 billion for the June floods in Germany, the Czech Republic et al; US$4.0 billion for the June floods in Canada; $US3.1 billion for the May severe thunderstorms and tornadoes in the U.S; $US2.0 billion for the March thunderstorms, tornadoes and hail in the U.S.; $US1.6 billion for the April snowstorm, ice, tornadoes and heavy rains in the U.S.; and $US2.0 billion for the January floods in Australia.


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