Impact Forecasting, the catastrophe model development center at Aon Benfield, a reinsurance intermediary and capital advisor of Aon plc, has released its Annual Global Climate and Catastrophe Report, which evaluated the impact of the natural disaster events that occurred worldwide during 2013.
The report revealed that 296 separate events produced total economic losses of $192 billion – four percent below the 10-year average of $200 billion, but above the average 259 events.
The natural disasters caused total insured losses of $45 billion – the lowest since 2009 and 22 percent below the 10-year average of $58 billion.
In a reversal from 2012, the largest global events of 2013 were heavily concentrated in Europe and Asia, rather than in the United States. However, despite just 16 percent of all economic losses occurring in the U.S., the U.S. accounted for 45 percent of all insured losses globally due to its greater insurance penetration.
Flood events accounted for 35 percent of all global economic losses during the year, which marked their highest percentage of aggregate losses since 2010. Notable events included major flooding in Central Europe, Indonesia, the Philippines, China, and Australia.
Meanwhile, severe drought conditions contributed to billion-dollar (US$) losses in Brazil, China, New Zealand, and the U.S.
Stephen Mildenhall, the chief executive officer of Aon Benfield Analytics, said, “2013 was an active year for serious catastrophe events but one in which the industry dodged the bullet of a single dominating insured event. Typhoon Haiyan, however, demonstrated the real and ever-present potential for large scale destruction. U.S. insured losses, at 45 percent of the total, were in-line with the U.S. 42 percent share of global property premium.”
The 2013 report offered a comprehensive analysis of possible loss trends across four key global regions: United States, Americas (Non-U.S.), Europe, the Middle East and Africa (“EMEA”), and Asia-Pacific (“APAC”).
The study highlighted that the most deadly event of 2013 was Super Typhoon Haiyan, which struck the Philippines in November, leaving nearly 8,000 people dead or missing.
The May/June floods in Central Europe were the costliest single event of the year, causing an estimated $5.3 billion insured loss and approximately $22 billion in economic losses. Most of the flood losses were sustained in Germany, which also endured record-level insured hail losses during multiple summer convective thunderstorm events.
No hurricanes struck the U.S. during the year, as the country extended its record streak without a major (Category 3+) hurricane landfall to eight consecutive years. The previous record was set between September 1900 and October 1906.
A total of 15 tropical cyclones (Category 1+) made landfall globally in 2013, slightly below the 1980-2012 average of 16. Thirteen of the landfalls were registered in the Northern Hemisphere, including nine in Asia.
Europe, the Middle East and Africa, and the Americas (Non-U.S.) each sustained aggregate insured losses above their 10-year averages in 2013. The United States and Asia-Pacific regions both incurred below normal insured losses.
Steve Bowen, senior scientist and meteorologist at Impact Forecasting, said, “Despite registering nine separate billion-dollar events, natural disaster losses in the U.S. were down 78 percent from 2012. The most significant losses in 2013 were found in Europe and Asia Pacific, where each region endured multiple events that had major financial and societal implications. While not the costliest event, Super Typhoon Haiyan was the most catastrophic after coming ashore in the Philippines as one of the strongest tropical cyclones ever recorded. Typhoon activity in the Western Pacific also led to Typhoon Fitow becoming the second-costliest insured event in China's history after payouts surpassed $1.0 billion. An active year in Europe saw economic losses that were the highest since 2002 and 90 percent above its recent 10-year average.”
The report also revealed that preliminary data indicated that 2013 was the fourth warmest year recorded since global land and ocean temperature records began in 1880.
Victoria Spears
Victoria Prussen Spears is senior vice president of Meyerowitz Communications Inc., a law firm marketing communications consulting company. A graduate of Sarah Lawrence College and Brooklyn Law School, Ms. Spears was an attorney at a leading New York City law firm before joining Meyerowitz Communications. She may be contacted at [email protected].