While CAT losses are down in the first half of 2022, they are 18% higher than the 21st-century average, according to Aon.
Global insured losses from natural disasters were estimated at $39 billion during the first half of 2022, down 31.6% from $57 billion during the first half of 2021 but 18% higher than the 21st-century average of $33 billion, according to the "Global Catastrophe Recap: First Half of 2022" report, published by Impact Forecasting, Aon's catastrophe model development team.
The majority of losses (54%) were the result of severe convective storm events in both the U.S. and Europe, with such storms causing losses in excess of $5 billion in Europe for the second year in a row, according to the report.
Yet, despite the notable reduction from last year, U.S. insured losses were close to the 21st-century average, accounting for nearly half of the global insurance industry impact.
“The continued effects of La Niña conditions, amplified by climate change's influence on global weather patterns, not only increased volatility and intensified many events, but also dictated the location," said Steve Bowen, managing director and head of catastrophe insight for Impact Forecasting.
Global natural disaster events have caused an estimated $92 billion in total economic losses during the first half of the year, 24% lower than the 21st-century average of $121 billion, according to the report. A total of 21 individual billion-dollar economic loss events were recorded—nine in the U.S.; seven in Europe, the Middle East and Africa; and three in the Asian Pacific. All these events were weather-related, apart from the Fukushima Earthquake in Japan, which resulted in a $8.5 billion economic loss, of which $2.7 billion was insured.
A total of 197 notable global natural disaster events were recorded during the first half of 2022, above the 21st-century average of 192. Seasonal flooding in China registering as the costliest economic loss event, totaling approximately $8.7 billion, according to the report.
While major CAT losses may be down in the first half of 2022, the second half of the year could bring further challenges.
“While the re/insurance industry remains resilient in handling elevated loss costs, the focus now shifts to the upcoming peak of the Atlantic Hurricane Season, which may bring new challenges during the second half of the year," Bowen said.
Olivia Overman is IA content editor.