Insured cat losses top $100 billion for fourth year: Swiss Re

Natural disasters resulted in insured losses of $108 billion in 2023, the fourth consecutive year in which losses have topped $100 billion, according to a report Tuesday from Swiss Re Ltd.

The reinsurer said it now forecasts that annual insured losses will grow by 5% to 7% over the long term, driven largely by exposure growth, especially in areas of higher catastrophe risk such as flood plains or on coastlines.

Although below 2022’s $133 billion in natural catastrophe losses, 2023’s $108 billion is well above the 10-year average of $89 billion, according to Swiss Re data.

The single largest loss event of 2023 was the earthquake in Turkey and Syria, with insured losses estimated at $6.2 billion, although the quake struck areas of low insurance penetration, and roughly 90% of the economic losses were not covered, according to the report.

Absent a major U.S. hurricane landfall, the insured loss total was driven by myriad smaller events.

There were 142 insured-loss-inducing catastrophes in 2023, with most of medium severity, defined as events resulting in losses of $1 billion to $5 billion. The number of such events has on average grown by 7.5% each year since 1994, almost double the 3.9% increase of all catastrophes, Swiss Re said.

Among these medium-severity events, severe convective storms last year caused an estimated $64 billion in insured losses, a high for this peril.

Hail is by far the main loss-making component of severe convective storms, making aging rooftops, which increasingly host glass solar power system installations, a major source of loss, the report said.