2020 disaster losses jump 35% to $202 billion: Swiss Re
Total losses caused by natural and man-made disasters shot up by 35 percent to $202 billion in 2020, Swiss reinsurance giant Swiss Re said Tuesday.
The amount of losses covered by insurers increased by 40 percent from 2019 to $89 billion, making it the fifth-costliest year for the industry on record since 1970, Swiss Re said in a statement, revising its initial estimates upwards.
In mid-December, the Swiss group, which acts as an insurer for insurers, carried out an initial assessment, estimating the figure at $87 billion.
On the final reckoning of $89 billion, $81 billion in costs arose from natural disasters, the costs of which have increased by 48 percent compared to 2019, said Swiss Re, which again highlighted the increase in costs generated by so-called “secondary peril events”.
More frequent than exceptional disasters, these second-level events — including thunderstorms, hailstorms, floods or landslides — alone accounted for 71 percent of the costs for natural disasters covered by insurers.
Their cost increased in 2020 mainly due to storms and fires in Australia and the United States.
“We have seen an increase in losses from secondary perils in recent years, such as severe convective storms, floods and wildfires,” said Martin Bertogg, Swiss Re’s head of catastrophe perils
Primary and secondary perils “are affected by the same loss-driving risk trends, including population growth, increasing property values in exposed regions and the effects of climate change”, he said.
“This suggests that with climate change, future peak loss scenarios could also increase significantly.”
The costs of claims generated by human activities, such as industrial accidents or fires, meanwhile decreased by 10 percent to $8 billion due to the restrictions imposed to rein in the Covid-19 pandemic.