Australian floods 'costliest' first-half insured disaster globally

Australian floods ‘costliest’ first-half insured disaster globally

8 August 2022

Swiss Re says the NSW/Queensland flood is the “costliest” insured natural catastrophe globally in the first-half of this year, with losses close to $US3.5 billion ($5 billion).

Overall insured losses from natural catastrophes totalled $US35 billion ($50 billion) for the period, down from $US46 billion ($66 billion) a year earlier but 22% above the average of the past ten years.

A series of winter storms, floods in South Africa and other secondary perils such as hailstorms contributed to the first-half insured losses.

“The effects of climate change are evident in increasingly extreme weather events, such as the unprecedented floods in Australia and South Africa,” Head of Catastrophe Perils Martin Bertogg said.

“This confirms the trend we have observed over the last five years, that secondary perils are driving insured losses in every corner of the world.”

Mr Bertogg says unlike hurricanes or earthquakes, these perils are ubiquitous and exacerbated by rapid urbanisation in particularly vulnerable areas.

“Given the scale of the devastation across the globe, secondary perils require the same disciplined risk assessment as primary perils such as hurricanes,” he said.

Head of Property & Casualty Australia and New Zealand Trent Thomson says Australia is among the top-10 countries for flood losses.

Data from Swiss Re Institute shows major flooding events in Australia between 1970 and early this year resulted in close to $US34 billion ($49 billion) in economic loss while insured losses came to close to US$16 billion ($23 billion).

“The relentless rain along the east coast of Australia this year is a stark reminder of the challenges in flood risk management and climate change, as well as the need for ongoing collaboration between re/insurers, government, and industry,” Mr Thomson told insuranceNEWS.com.au.