US storms make 2021 one of most costly years for insurers: Swiss Re

FRANKFURT • Hurricane Ida and a winter storm that brought freezing temperatures to Texas made 2021 one of the costliest years on record for insurers, said Swiss Re.

The reinsurer yesterday also warned of bigger losses in years to come as populations and industry face the prospect of increasingly severe weather events amid climate change.

Insured losses from natural catastrophes totalled US$105 billion (S$143.7 billion) this year, the fourth-highest since Swiss Re began keeping records in 1970.

"Natural catastrophe losses are likely to continue to grow more than global GDP, given increases in wealth, urbanisation and climate change," Swiss Re said in a statement with its annual tally, referring to gross domestic product.

More than 10,000 people were killed or are still missing as a result of this year's natural disasters, Swiss Re said.

Hurricane Ida, which caused damage stretching from New Orleans to New York, led to insured losses of US$30 billion to US$32 billion. Winter storm Uri, which primarily hit Texas, resulted in US$15 billion in losses. Floods in Germany and surrounding countries resulted in US$13 billion in insured damages.

Many of the events this year were exacerbated by climate change, scientists say, adding that there are more - and worse - to come as the earth's atmosphere continues to warm through the next decade and beyond.

The costliest year on record was 2017, with hurricanes Harvey, Irma and Maria. That was followed by 2011, when big earthquakes hit Japan and New Zealand, and 2005, when Hurricane Katrina ravaged New Orleans.

Insurers have in some cases been raising the rates they charge as a result of the increasing likelihood of disasters, and in some places they have stopped providing coverage.

REUTERS