Global losses from natural disasters increase sharply in 2020: Munich Re

Global losses from natural disasters in 2020 amounted to $210 billion, of which some $82 billion was insured, according to Munich Re.

This compared to $166 billion of overall losses, and $57 billion of insured losses, in 2019.

The US share of losses was notably high, with US natural disasters accounting for $95 billion, of which $67 billion were insured. In 2019 losses from US natural disasters amounted to $51 billion, of which $26 billion were insured.

Of the ten costliest natural disasters in 2020, six occurred within the US, with the most destructive event being a Category four hurricane, Laura, which caused losses of $13 billion, of which $10 billion were insured.

Overall, the uninsured portion of natural disaster losses in 2020 was around 60 percent, according to Munich Re, with Asia remaining notable for its coverage gap. The year’s costliest natural disaster was the severe flooding in China during the summer monsoon rains, which caused approximately $17 billion of damage, of which only around 2 percent was insured.

The year was also characterised by large wildfires across the western US, including record-setting fires - in terms of area burned - in California and Colorado. Losses from wildfires in the western US amounted to $16 billion, of which $11 billion was insured.

In Europe, the natural disaster figures for 2020 were relatively low, with overall losses coming in at $12 billion, of which $3.6 billion were insured.

Ernst Rauch, chief climate and geo scientist at Munich Re, said the extreme losses for 2020 fit with the expected consequences of a decades-long warming trend for the atmosphere and oceans.

“An increasing number of heatwaves and droughts are fuelling wildfires, and severe tropical cyclones and thunderstorms are becoming more frequent,” he said. “Research shows that events such as this year’s heatwaves in northern Siberia are 600 times more likely to occur than previously.”