Global: Severe thunderstorms drive insured losses to $60bn in 1H2024
Source: Middle East Insurance Review | Sep 2024
A high frequency of small to medium events resulted in global insured losses from natural catastrophes of $60bn in the first half of 2024, according to Swiss Re Institute’s preliminary estimates. Severe thunderstorms, mainly in the US, accounted for 70% of global insured losses.
Thunderstorms or severe convective storms (SCS) are characterised by strong winds including tornadoes, hail and heavy rain, said Swiss Re Institute. In total, these led to insured losses of $42bn globally in the first half of 2024. In the US, 12 storms each caused losses of $1bn or more, demonstrating the loss potential of this peril. According to Swiss Re Institute’s sigma 1/2024, insured losses from SCS in the US have increased by around 8% in nominal terms annually since 2008.
Swiss Re head of catastrophe perils Balz Grollimund said, “In recent years, severe thunderstorms have emerged as a main driver of a significant increase in insured losses. This is due to growing populations and higher property values in urban areas, along with insured property being more vulnerable to hail damage. Therefore, multi-billion-dollar loss events from this peril are likely to become more common.”
Floods also caused above-average losses, driven by events in the UAE, Germany and Brazil, and accounted for 14% of global insured losses. In April, torrential rain caused by severe thunderstorms led to flash floods on the Arabian Peninsula, resulting in unprecedented damage in the UAE. According to industry estimates, insured losses will likely amount to at least $2bn, making it the country’s costliest natural disaster on record. While heavy rainfall is expected to increase in a warmer climate, swift urban growth, land use alteration, scarce drainage systems, and dry soils intensify loss severity. M