Aon report reveals half-year disaster costs

25 July 2022

Aon’s Global Catastrophe Recap reports that the insurance industry has paid out $US39 billion ($56.45 billion) globally in the first six months of this year, above the 21st century average.

The insurer says La Nina-related conditions intensified the damage and location of severe weather events, with costs exacerbated by financial impacts of rising inflation and the conflict in Ukraine.

“The fingerprints of climate change continued to become more evident in individual event behaviour and longer-term temperature and precipitation trends in 1H 2022,” the report said.

Severe convective storms in Europe and the US accounted for 54% of all insured losses with at least nine separate billion-dollar insured events, all of which were weather-related bar one.

Historical floods in NSW and Queensland in February and March were estimated to be the largest insured loss event, accounting for $US3.5 billion ($5.07 billion). The floods were the third costliest event in terms of economic losses, recording losses of $US7.5 billion ($10.86 billion).

Seasonal flooding in China in June and March’s 7.3 magnitude earthquake off the shore of Fukushima, Japan, topped the list for costliest events, with $US 8.7 billion ($12.59 billion) and $US 8.5 billion ($12.30 billion) economic losses respectively.

Economic losses amounted to $US92 billion ($133.17 billion), below the 21st century average, with fatalities attributed to insurance events also below average.

Aon says the industry should expect further strains with upcoming hurricane seasons in the Atlantic and elevated wildfire activity combined with inflationary pressures likely to cause excessive costs.