Extreme storms, wildfires and droughts cause heavy nat cat losses in 2018: Munich Re

Munich Re released a report of major losses incurred in 2018. Here is an overview of the losses incurred in 2018:-

Overall losses of US$ 160bn were above the inflation-adjusted average for the last 30 years (US$ 140bn). This year’s losses were below the extremely high losses of 2017, which had totalled US$ 350bn and were due mainly to record hurricane losses.

At US$ 80bn, insured losses were substantially above the inflation-adjusted average for the last 30 years (US$ 41bn), but below last year’s record figures (US$ 140bn).

Regrettably, some 10,400 people lost their lives in 2018 as a result of natural catastrophes. Compared with the average of 53,000 over the past 30 years, however, a decrease can be seen. This long-term trend is a clear indication that, from a global perspective, measures to protect human life are starting to take effect.

The deadliest disaster of 2018 was a seven-metre tsunami that took the Indonesian city of Palu by surprise on 28 September following an earthquake nearby. Thousands of buildings were destroyed and some 2,100 people were killed. A further tsunami hit coastal regions of Sumatra and Java – islands of Indonesia – on the evening of 22 December. The metre-high tidal wave is thought to have been caused by an underwater landslide triggered by an eruption of the Anak Krakatau volcano. Since existing tsunami early-warning systems only respond to earthquakes, the metre-high wave caught inhabitants unawares. At least 400 people died.

The most expensive natural catastrophes occurred in the US: The costliest events were “Camp Fire”, a wildfire in northern California with overall losses of US$ 16.5bn and insured losses of US$ 12.5bn, and Hurricane Michael (overall losses of US$ 16bn, and insured losses of US$ 10bn).

The sustained drought which caused substantial agricultural losses and many wildfires was Europe’s costliest natural disaster of the year. Direct losses came to US$ 3.9bn (€3.2bn), with only a small proportion of these losses insured. Low water levels on many rivers lasting well into the autumn impacted river traffic and thus also freight transport and the economy.