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Catastrophe insurance industry losses reach $75 billion in 2007
Originally posted on sciy.org by Ron Anastasia on Fri 18 Jan 2008 02:00 AM PST
LONDON
(MarketWatch) -- The insurance industry faced $75 billion of losses
from natural catastrophes during 2007, up 50% from last year despite a
lack of "megacatastrophes," German reinsurer Munich Re said Thursday.
The losses rose from $50 billion in 2006, though this was still well
short of the $220 billion reached in 2005 when Hurricane Katrina
ravaged New Orleans and the U.S. Gulf Coast.
Still, the number of
natural catastrophes tallied 950 this year, up from 850 in 2006 and the
highest figure since 1974, when Munich Re began tabulating such events.
"The figures confirm our
expectations and endorse our insistence that risks be consistently
written at adequate prices, despite years with comparatively low losses
as in 2006," said Torsten Jeworrek, a Munich Re board member, in a
statement.
"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. We should not
be misled by the absence of megacatastrophes in 2007."
The worst catastrophes in
2007 hit Asia, with 3,300 deaths in Bangladesh from Cyclone Sidr, but
the biggest losses to the insurance industry came from Europe after the
Kyrill winter storm, Munich Re said. Kyrill caused $10 billion of
damage, leaving insurers to foot the bill for $5.8 billion of that, it
said.
There was also about $8
billion of damage from a pair of summer floods in England. Insurers
took on a $6 billion hit.
"These events cannot, of
course, be attributed solely to climate change, but they are in line
with the pattern that we can expect in the long term: severe storms,
more heavy rainfall and a greater tendency toward flooding, including
in Germany," said Peter Hoppe, head of Munich Re's geo risks-research
department.
According to data
published by the Hadley Centre in the U.K. for the period up to
December, 2007 was the seventh warmest year on record worldwide and the
second warmest in the Northern Hemisphere.
This means that the 11 warmest years worldwide have been recorded during the last 13 years.
In July, a major earthquake that struck the Niigate prefecture in Japan
caused $12.5 billion in damage, but those losses largely weren't borne
by the insurance industry.
Steve Goldstein is MarketWatch's London bureau chief.
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