Here's some good news we can all get behind: 2014 was the least expensive year for natural catastrophes since 2009, according to a newly released report by Aon Benfield's catastrophe model development team.
Last year, global catastrophes accounted for over $132 billion in total economic damages, $39 billion of which was in insured losses, which is down 38% from the 10-year average, according to the report.
The numbers also show that, despite Asian countries having the most devastating economic losses, and the fact that more than 75% of disasters happened outside the U.S., most insured losses were in the U.S. due to high insurance penetration in this country.
"Despite 27 individual billion-dollar natural disasters in 2014, overall economic losses were below average for a second consecutive year," said Steve Bowen, associate director and meteorologist at Aon's Impact Forecasting. "The most significant losses were found in Asia, where the region sustained 57% of the overall economic loss and each of the top five costliest events. However, the United States incurred 53% of the global insured loss total and accounted for six of the top ten costliest insured losses of the year."
The two most expensive catastrophes were due to thunderstorms in the U.S. and Europe over the summer, which cost a total of $5.9 billion in insured damages, according to the report.
But there were significantly more devastating storms that resulted in major economic impacts and loss of life, including a series of flash floods in Afghanistan which killed over 2,600 people, and 13 tropical storms that hit Asian territories with full force.
But even though the losses were severe, no areas sustained enough damage to reach their 10-year averages. And that's progress, says Aon's CEO of Analytics, Stephen Mildenhall.
"With its abundant capital and sophisticated risk management tools, the industry is better positioned than ever to deliver on its core mission of providing critical risk transfer products that enable growth and development all around the world."
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.