Munich Re reported that the death toll in natural disasters such as earthquakes, storms and heatwaves rose sharply worldwide in the first six months of 2015. Munich Re, the world’s largest reinsurance company said it’s biannual review, that the economic cost of such events dropped to $35 billion from $42 billion, reflecting the fact that events occurred more in poorer parts of the world.
Insurance covered only $12 billion of the first six months losses compared with a long-term average of $15 billion. The figures support the industry’s view that much of the world remains under-insured and that insurance could play a greater role in supporting economic recovery after a disaster. This is of course a sad situation, making recovery in those hardest hit areas even more difficult.
The number of people killed overall rose to 16,000 in the first half of 2015 from 2,800 the year before. An earthquake in Nepal in April was the most devastating disaster, killing 8,850 people and destroying thousands of homes as well as cultural heritage sites. Economic damage totaled $4.5 billion, equivalent to almost a quarter of Nepal’s annual gross domestic product. But only $140 million of that was insured.
In economic terms, the costliest catastrophe was a series of winter storms that hit the northeastern United States and Canada at the end of February, causing insured losses of $1.8 billion, with total losses of $2.4 billion.
Some of the current extreme weather conditions are tied to the El Nino weather pattern, or a warming of sea-surface temperatures in the Pacific, which can lead to scorching weather across Asia and east Africa but heavy rains and floods in South America.
“The currently already intense El Nino phase is expected to become even stronger as we head into the autumn,” Munich Re said, adding that, however, El Nino years tended to see fewer hurricanes in the United States.