Wildfires and severe convective storms have displaced hurricanes as the main source of insured catastrophe losses in North America, with Swiss Re reporting that secondary perils accounted for almost the entire $90 billion in regional reinsurance losses recorded in 2025.
The findings, contained in the latest sigma report from the Swiss Re Institute, set out a year in which the absence of a major US hurricane landfall did little to relieve the industry, as California wildfires and storms across the country's mid-section pushed losses to among the highest on record.
California wildfires drove $40 billion of the total, while severe convective storms contributed $46 billion. Together, secondary perils made up roughly 99.9% of insured natural catastrophe losses across North America, a share Swiss Re said reflects a structurally higher baseline rather than a single bad year.
Human activity sits at the center of the wildfire story. About 85% of US wildfires are caused by people, while population growth in high wildfire-risk areas is running at three times the national average, leaving more homes and businesses in the path of increasingly frequent fires.
The pattern is not confined to North America. The same report found secondary perils drove 92% of insured catastrophe losses worldwide in 2025, with severe convective storms generating $51 billion globally to make it the third-costliest year on record for the peril behind 2023 and 2024.
Swiss Re's Balz Grollimund said a return to trend would push global insured losses to $148 billion in 2026, with a modeled peak-loss scenario reaching about $320 billion.
The numbers point to a recalibration of how the reinsurance market prices, deploys capacity and stress-tests portfolios against perils that no longer behave like tail events.
Monica Ningen, CEO of property and casualty reinsurance US at Swiss Re, said 2025 was a clear signal that the risk landscape is shifting in ways the industry and communities cannot afford to treat as episodic. She said wildfire and severe convective storms "are no longer 'secondary' in any practical sense."
Ningen attributed the trend to exposure growth and underlying risk change, with more assets concentrated in the wildland-urban interface and weather patterns lifting both event frequency and severity. The result, she said, is a higher baseline of expected losses even in years that do not look extreme at first glance.
For carriers, Ningen said the data reinforces the need to be deliberate about where and how risk is taken, starting with accumulation analysis and extending into mitigation investment to soften the impact of secondary perils on future reinsurance cycles.
"The encouraging part is that adaptation works," she said, pointing to stronger building standards and improved land-use decisions as measures that can lower loss costs over time.
She added that progress depends on alignment between homeowners, businesses, insurers and governments in building resilience as Swiss Re and the wider market adjust.
