Reflection on how climate change shapes the global insurance landscape through extreme weather events, from heat waves to powerful storms and floods.
In the first half of the year, about 70 percent of insured damages stemmed from disasters, with severe thunderstorms hitting the United States hardest and Switzerland remaining among the world’s leading reinsurers.
Among the notable events, one of the most costly was the earthquake sequence in Türkiye and Syria, with economic losses surpassing 31 billion euros, of which only 4.8 billion were insured.
By June, total global economic losses reached roughly 114 billion euros, which is 41 percent above the ten-year average for the first half. Of this total, around 109 billion euros came from natural disasters, 46 percent above the decade average; losses from human actions stood at 4.5 billion, about 23 percent below the average. The quarter also did not include the devastating fires in Hawaii in the balance.
Swiss Re notes that storms featuring thunder, lightning, heavy rain, hail, wind, and abrupt temperature shifts caused about 32 billion euros in damage in the United States. This represents a share of insured catastrophe claims for the period that is 68 percent and is almost double the loss level of the same period last year, with Texas the state most affected.
New Zealand experienced two extreme weather events within just two weeks in early 2023, signaling rising climate-related hazards for major urban centers. The North Island, especially Auckland, faced severe flooding and the remnants of Hurricane Gabrielle, making these events among the most expensive weather-related insured losses in New Zealand since 1970.
Effects of climate change
Experts note that the impacts of climate change are becoming clearer through increasingly extreme weather events. The chief economist of the group emphasizes that heat waves, droughts, floods, and heavy rains are already evident. In addition, coastal and riparian land use planning, along with urban expansion into natural areas, creates high-value risks in vulnerable environments. Protective measures are needed to keep insurance products affordable for properties in high-risk zones, and greater investment in climate adaptation is urged.
In the Emilia-Romagna region of northern Italy in mid-May, heavy rainfall caused substantial flooding and insured losses exceeding 546 million euros, marking the costliest weather event in Italy since 1970.
Estimated losses reached 9.1 billion euros, while 94 percent of Italian losses are uninsured. Swiss Re highlights that insurance plays a crucial role in bridging the protection gap and helping households strengthen financial resilience against natural disasters.
Since the start of July, the United States, northwest Europe, and southern Europe have faced heat waves, with dry conditions and strong winds fueling wildfires in Italy, Algeria, and many Greek islands. It remains early to estimate the full economic and insured damage from these events.
Earthquakes continue to cause severe human and financial losses. The costliest disaster in both economic and insured terms remains the 2009 earthquake in Türkiye and Syria, which disrupted livelihoods across the region.
Swiss Re estimates insured losses at 4.8 billion euros, while temporary economic losses are projected around 31 billion euros, according to the World Bank data.