Natural disasters will cost $95 billion in 2023

In 2023, natural disasters including earthquakes in Turkey and Syria and severe storms in the United States caused approximately $95 billion in insured losses. The figure reported by Munich Re, the world’s largest reinsurer, is down from insured losses of $125 billion in 2022, but still exceeds the 10-year average of $90 billion and the 30-year average of $57 billion.

The most catastrophic events were the earthquakes in Turkey and Syria, which killed 58,000 people and caused total losses of US$50 billion, of which US$5.5 billion was insured. Munich Re highlighted the increasing frequency of severe storms in the region, particularly in the United States and Europe, and attributed this trend to the effects of climate change.

Ernst Rauch, chief climate scientist at Munich Re, highlighted the growing impact of what were once considered secondary loss events. These regional storms are now a significant driver of insurance losses.

Total losses from natural disasters in 2023, including uninsured losses, will reach $250 billion. This amount is consistent with total losses recorded in 2022 and the average over the past five years, but higher than the 10- and 30-year averages. It’s worth noting that North America is responsible for a large portion of these losses, despite reports of a relatively mild hurricane season.

Insurers are responding to the increasing frequency and severity of natural disasters by adjusting rates and, in some cases, canceling coverage in certain areas. Scientists warn that the warming of Earth’s atmosphere could worsen damage from natural disasters in the coming decades, which could further impact the conservation industry’s insurance and pricing methods.

Reuters contributed to this article.

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