Global catastrophe losses revealed

Global insured losses from natural disasters hit $88 billion by the end of the third quarter, according to a new report from Aon.

The total is 17% higher than the 21st century annual average, according to Aon’s Q3 Global Catastrophe Recap report. It was driven by third-quarter events such as severe convective storms (SCS) in the US and Italy and the Maui wildfire.

Year-to-date economic losses were $295 billion, down from the 21st century annual average of $310 billion, the report found.

However, the aggregated death toll from natural catastrophes surpassed 75,000 during the same period, making 2023 the deadliest year for natural disasters since 2010, Aon reported.

In the third quarter alone, there were at least four separate billion-dollar insured loss events for severe convective storms in the US. That figure will likely be revised upward to seven events due to continued loss development, Aon reported. Insured losses from SCS in the US exceeded $50 billion for the first time, accounting for 60% of global insured losses. Europe also dealt with two billion-dollar SCS events.

Other natural catastrophe events occurring in Q3 included:

• Flooding in Beijing and several Chinese provinces in August that resulted in the costliest global economic loss event of the third quarter
• A magnitude-6.8 earthquake in the Moroccan High Atlas Mountain range on Sept. 8. The earthquake caused at least 3,000 deaths and more than 5,600 injuries
• Flash flooding in northeastern Libya in early September, which damaged thousands of buildings and ranked as the second-deadliest catastrophe of the year with more than 4,300 deaths
• While hurricane losses in the US were lower than average, two tropical systems – Hilary and Idalia – caused significant losses

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“Global natural catastrophes killed many people and caused significant structural and economic damage during the first nine months of 2023,” said Michael Lorinc, head of Aon’s Catastrophe Insight. “Wildfire and severe convective storms were once again highly prominent, and Aon’s research reveals that both are becoming increasingly costly to insurers, communities and governments. In the US, around 80% of SCS loss growth can be explained by exposure change, highlighting the need for insurers to understand underlying exposures in their portfolios.”

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