Zurich (AFP) – Economic losses from natural catastrophes worldwide are estimated to have reached $100 billion in the first half of this year, reinsurance group Swiss Re said Tuesday — a sharp decline from the period last year. Despite severe storms in the United States and the deadly earthquakes that struck Venezuela in June, the losses were well below the $152 billion recorded in the first half of 2025, the group said in its latest report. The losses were also 10 percent below the 10-year average for the period.
But Swiss Re, which serves as an insurer for insurance companies, noted that losses from natural disasters often increase in the second half of the year, mainly due to hurricanes in the North Atlantic ocean. “A less costly first half of the year does not mean the risk has gone away,” said Balz Grollimund, the group’s director of catastrophe perils. “One major hurricane, earthquake or wildfire can quickly change the picture.”
Of the estimated first-half $100 billion losses from natural catastrophes, an estimated $42 billion were covered by insurance. The Venezuelan earthquakes caused the most economic damage, estimated at around $20 billion, but low insurance levels means the share of insured losses is likely to be low, the Zurich-based reinsurance giant said. Severe heat across Europe since June has sparked an early wildfire season in France and Spain that has already destroyed thousands of homes and businesses as well as infrastructure.
“Wildfire risk has so far accounted for only a relatively small share of insured losses in Europe. Yet it is the fastest-growing weather peril globally,” the company said. It said insured wildfire losses had risen by 8-11 percent per year in Europe since 1970 after adjusting for inflation and other factors. Swiss Re said Europe experienced around 21 to 26 hot days (30C or above) each year on average, between 2016 and 2025, compared with 10 to 17 in the 1950s. Such heat “acts as a multiplier of other natural hazards by creating conditions more conducive to droughts, wildfires, and, in some regions, flash flooding,” it said.
– El Nino risk – The reinsurance giant said the longer-term challenge would be building resilience to a warmer and more fire-prone environment, much as Europe had gradually strengthened its flood risk management. “Stronger prevention, land management, building resilience and emergency response will be key to preventing larger wildfire losses,” it said.
Looking forward, Swiss Re warned that the El Nino climate pattern, which began in June and is expected to peak later this year, could accentuate the cost from weather-related disasters. The reinsurer said that although a strengthening El Nino may temper North Atlantic hurricane activity in the second half of the year, the risk of a costly major event remains. “El Nino may influence tropical cyclone activity in the Central and East Pacific and could alter the risk of floods, wildfires, and other weather extremes elsewhere,” it said. “The long-term drivers of catastrophe losses remain unchanged, including growing exposure in hazard-prone areas and rising reconstruction costs,” it added.
© 2024 AFP
