According to a leading re-insurer, disaster losses for insurers nearly doubled in the past year to reach almost $30 billion globally. The main culprits for the massive increase were calamitous winter storms in Europe, flooding in Britain and wildfires in the U.S.Taking into account weather change, Munich Re anticipates an increased number of catastrophes in coming years and warns, "We should not be misled by the absence of mega-catastrophes in 2007," as "climate change is already taking effect" and "more such extremes are to be expected in the future."
The world's second-largest re-insurer estimates that losses to insurers from natural disasters jumped up to $75 billion this year. During 2006, losses from natural disasters totaled only $50 billion, while 2005 figures climbed up to $220 billion due primarily to Hurricane Katrina's ravaging of New Orleans.
A huge impact for insurers' losses was a mid-January winter storm which left 49 people dead, brought transportation havoc, destroyed property and tore down power lines across a broad swath of northern Europe. According to Munich Re, this one storm alone brought insured losses of roughly $5.8 billion, and total economic losses of around $10 billion.
Let's also remember those two bouts of flooding in Britain in June and July, which caused losses of $3 billion, and October wildfires in the United States that came with insured losses of $1.9 billion.
If we take into account some other disasters such as Caribbean storms or August's deadly Hurricane Dean, we could count 950 natural disasters, 100 more than the 850 catastrophes recorded last year, as Munich Re declared.
Looking ahead, Munich Re's Jeworrek believes that "speedy international action is needed" to prevent further disasters that could cause higher costs for society and huge losses for insurers.
Eliza Popescu is a financial writer for the online investment advisory service Investor's Observer.
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