Munich Re Looks Back at 2021’s Worst Weather Events

Latest 2021 stats on weather related losses around the world are in focus with Munich Re;

  • In 2021, natural disasters caused overall losses of US$ 280bn, of which roughly US$ 120bn were insured
  • Alongside 2005 and 2011, the year 2021 proved to be the second-costliest ever for the insurance sector (record year 2017: US$ 146bn, inflation-adjusted) – overall losses from natural disasters were the fourth-highest to date (record year 2011: US$ 355bn)
  • Hurricane Ida was the year’s costliest natural disaster, with overall losses of US$ 65bn (insured losses of US$ 36bn)
  • In Europe, flash floods after extreme rainfall caused losses of US$ 54bn (€46bn) – the costliest natural disaster on record in Germany
  • Many of the weather catastrophes fit in with the expected consequences of climate change, making greater loss preparedness and climate protection a matter of urgency.

GLOBAL CONCERNS

Worldwide, natural disasters caused substantially higher losses in 2021 than in the two previous years. Based on provisional data, storms, floods, wildfires and earthquakes destroyed assets worth US$ 280bn. Losses in the previous year amounted to US$ 210bn, while in 2019 they were US$ 166bn. Roughly US$ 120bn of losses were insured, which was also more than in the two previous years (2020: US$ 82bn, 2019: US$ 57bn). The insurance gap, in other words the uninsured portion, declined slightly due to a higher proportion of losses in the USA, but was still approximately 57%. Almost 10,000 people lost their lives in natural disasters in 2021, a death toll comparable with those of recent years.
EUROPEAN FLOODS
In Europe, torrential rainfall in July 2021 triggered exceptionally severe floodings that caused devastating losses in local areas, particularly in western Germany. In the regions affected, the rainfall caused by the low-pressure system “Bernd” was the highest in over a hundred years. In tributaries, such as the River Ahr in the Rhineland-Palatinate, the deluge triggered flash floods that swept away countless buildings. There was also severe damage to infrastructure, such as railway lines, roads and bridges. More than 220 people were killed.

Overall losses came to €46bn (US$ 54bn), of which €33bn (US$ 40bn) was in Germany. The insured portion was relatively low because of uninsured infrastructure losses and the limited insurance density for flooding in Germany. €11bn (US$ 13bn) was insured, of which €8.2bn (US$ 9.7bn) was in Germany, according to figures provided by the Association of German Insurers. It is the costliest natural disaster in Germany and Europe to date.

PARTNERSHIPS

On a global level, around 57% of losses from natural catastrophes in 2021 were not insured. Those affected must bear the financial losses themselves, or rely on aid. This insurance gap has declined over the last few decades in industrialised countries, whereas in poorer countries it remains unchanged at over 90%.

In industrialised countries, the proportion of insured losses depends on the particular natural hazard concerned. For example, in the USA and Europe, insurance density is much lower for floods than for storms. Some infrastructure in the USA is insured, while this is seldom the case in Europe.

“Greater insurance density can help people and countries to better cope with the financial consequences of a disaster and help them return to a normal life. Developing concepts in partnership with governments (public-private partnerships) certainly makes sense,” explains Ernst Rauch.

About alastair walker 7767 Articles
20 years experience as a journalist and magazine editor. I'm your contact for press releases, events, news and commercial opportunities at Insurance-Edge.Net

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