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Insured losses from natural disasters nearly doubled in 2007, company says

Insured losses from natural disasters nearly doubled in 2007, company says

Losses to insurers from natural disasters nearly doubled this year to just below US$30 billion (euro20.8 billion) after an unusually quiet 2006, a leading reinsurer said Thursday, with a winter storm in Europe the costliest single event.
Munich Re also warned that climate change could mean more weather-related catastrophes in coming years.
In its annual disaster review, the company said insured losses this year compared with last year's US$15 billion. While the figure leapt, it remained far short of the US$99 billion that Munich Re recorded in 2005 _ when losses were swollen by claims from Hurricane Katrina in New Orleans.
Munich Re put total economic losses _ which includes losses not covered by insurance _ from natural disasters at US$75 billion (euro52 billion) for 2007 _ a 50 percent increase from last year's US$50 billion, but far below the 2005 figure of US$220 billion.
The costliest disaster for insurers was a Jan. 18-19 winter storm, dubbed Kyrill in German-speaking countries, which killed 49 people, caused transport havoc, damaged property and tore down power lines across a broad swath of northern Europe.
The storm resulted in insured losses of about US$5.8 billion (euro4 billion) and total economic losses of some US$10 billion (euro6.9 billion), Munich Re said. Germany accounted for more than half the total.
Two bouts of flooding in Britain, in June and July, each led to insured losses of some US$3 billion (euro2.1 billion) and total economic losses of US$4 billion (nearly euro2.8 billion), Munich Re said.
Wildfires in the United States in October caused insured losses of US$1.9 billion (euro1.3 billion), while a mid-April U.S. winter storm resulted in losses of US$1.57 billion (nearly euro1.1 billion), the company said.
This year's costliest Caribbean storm, August's deadly Hurricane Dean, placed only seventh overall, with insured losses of US$1 billion (euro690 million).
"The relatively low losses can be explained by the tracks of the hurricanes _ no major hurricanes reaching the US mainland, as in 2006," Munich Re said in a statement.
Munich Re said the year's deadliest natural disasters by far were November's tropical cyclone Sidr in Bangladesh, which killed some 3,300 people; and flooding in South Asia from July to September, which accounted for 3,000 lives. Neither ranked among the year's 10 costliest in terms of insured losses.
The company said that, in all, 950 natural disasters were recorded this year _ up from 850 last year, and the highest figure since the company started keeping systematic records in 1974.
"The trend in respect of weather extremes shows that climate change is already taking effect and that more such extremes are to be expected in the future," board member Torsten Jeworrek said in a statement. "We should not be misled by the absence of megacatastrophes in 2007."
"All the facts indicate that losses caused by weather-related natural catastrophes will continue to rise," he added.
Jeworrek said his company was "ready to deal with this," but noted that higher insurance premiums and tax-financed infrastructure repairs would result in higher costs for society as a whole, and said that "speedy international action is needed."
Munich Re is a reinsurer, meaning it offers backup policies to companies writing primary insurance policies. Reinsurance helps spread risk so that the system can handle large losses from natural disasters.
(gm)


Updated : 2021-04-17 04:21 GMT+08:00