International (non-US) insured catastrophe losses reached $16.7bn in 2023

The CRESTA organisation, that tracks international insurance industry losses outside the United States, has estimated the full-year 2023 loss at US $16.7 billion, which it notes is slightly below the annual average.

This figure only included insured catastrophe loss events from a threshold of US $1 billion and Cresta highlights that there are other events which could reach that level, should loss development persist.

Those are severe convective storms that occurred in Germany in mid-June 2023 and severe convective storms that impacted Eastern Australia in late December.

In 2023, there were seven catastrophe events with insurance industry losses that exceeded the US $1 billion loss threshold, Cresta said.

These seven catastrophe loss events were:

North Island Floods, New Zealand, Jan 2023
Kahramanmaras Earthquake Sequence, Turkey, Feb 2023
Cyclone Gabrielle, New Zealand, Feb 2023
Northern Italy Severe Convective Storms, Jul 2023
Beijing-Tianjin-Hebei Floods (Typhoon Doksuri), China, Jul-Aug 2023
Hurricane Otis, Mexico, Oct 2023
European Windstorm Ciarán, Nov 2023

The overall figure for these billion-dollar-plus insurance and reinsurance industry loss events totals US $16.7 billion for 2023.

The annual average annual total is US $17.1 billion, adjusted to 2023 values, for the last 23 years, Cresta explained.

The Kahramanmaras Earthquake Sequence in Turkey on February 6th 2023 is estimated to have generated an insurance industry loss of US $5.8 billion, making it the largest ever catastrophe loss for the Turkish insurance market.

After that came the severe convective storms which hit Northern Italy from July 19-25, which are estimated to have generated an industry loss of US $2.7 billion, again a record-breaking figure for the Italian insurance market, Cresta said.

New Zealand’s flooding and cyclone Gabrielle drove US $2.7 billion of industry losses between them, which is also a record for that country.

Adding to the records set in 2023, hurricane Otis in Mexico in October was also a record loss event for the country, on an original loss-cost basis, Cresta highlighted.

Matthias Saenger, Manager at CRESTA CLIX, commented, “While from a global perspective, international Cat losses in 2023 were slightly below the long-term average, several countries experienced record-breaking events, namely Turkey, Italy, New Zealand and Mexico.

“This situation effectively illustrates the value proposition of global reinsurance: extraordinary or even record-breaking Cat losses on a national market level can represent quite “normal” loss levels in a globally diversified reinsurance portfolio. This scenario was the case in 2023 and explains why this year’s Cat losses were managed so robustly.”