Quakes and storms cause $95bn insurance losses in 2023

Earthquakes in Turkey and Syria, storms in the US and other natural disasters caused an estimated $95bn in insurance losses in 2023, down from the previous year but still above the long-term average, Munich Re said on Tuesday.

The tally of losses from natural catastrophes covered by insurance is less than the $125bn recorded in 2022 and is also lower than an estimate of $100bn published last month by rival Swiss Re.

But the 2023 figure from Munich Re, the world’s largest reinsurer, is above a 10-year average of $90bn and well above a 30-year average of $57bn.

The quakes in Turkey and Syria were the most destructive events, causing 58,000 deaths, $50bn in overall losses and $5.5bn losses covered by insurance.

But what stood out in 2023, Munich Re said, were not single big events but the numerous severe regional storms in the US and Europe that are increasing as a result of climate change.

“The background noise has become louder. Loss events that were previously regarded as secondary and acknowledged as less significant ‘side risks’ have become a major loss driver,” Ernst Rauch, chief climate scientist at Munich Re, said.

Total losses from natural catastrophes, including those not covered by insurance, were $250bn in 2023. That is similar to 2022 and the average of the previous five years, but above 10-year and 30-year trends.

North America once again accounted for a big portion of the losses, though the hurricane season was mild.

Scientists have said that a warming of Earth’s atmosphere will cause more damage in the decades ahead.

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