Thursday, 5 January 2012
Munich Re confirms 2011 costliest disaster year ever
Last year was the costliest year ever in terms of natural catastrophe losses, according to Munich Re's analysis of the full year. The German-based reinsurer estimates that at about $380bn, global economic losses were nearly two-thirds higher than in 2005, the previous record year with losses of $220bn.
Torsten Jeworrek
The reinsurer calculates that the earthquakes in Japan in March and New Zealand in February alone caused almost two-thirds of these losses. It also estimates that insured losses of $105bn also exceeded the 2005 record of $101bn.
Torsten Jeworrek, Munich Re board member responsible for global reinsurance business, said: "Thankfully, a sequence of severe natural catastrophes like last year's is a very rare occurrence. We had to contend with events with return periods of once every 1,000 years or even higher at the locations concerned. But we are prepared for such extreme situations. It is the insurance industry's task to cover extreme losses as well, to help society cope with such events and to learn from them in order to protect mankind better from these natural perils."
There were some 820 loss-relevant events according to Munich Re's analysis and this was in line with the average of the last ten years. The reinsurer said that 90% of the recorded natural catastrophes were weather-related but added that nearly two-thirds of economic losses and about half the insured losses stemmed from geophysical events, principally from the large earthquakes.
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Munich Re pointed out that normally, it is the weather-related natural catastrophes that are the dominant loss drivers. On average over the last three decades, geophysical events accounted for just under 10% of insured losses.
The reinsurer also pointed out that the distribution of regional losses in 2011 was also unusual as around 70% of economic losses in 2011 occurred in Asia.
Some 27,000 people fell victim to natural catastrophes in 2011. "This figure does not include the countless people who died as a result of the famine following the worst drought in decades on the Horn of Africa, which was the greatest humanitarian catastrophe of the year. Civil war and political instability made it very difficult to bring effective aid to the victims," pointed out the company.
The US was hit by an extraordinary number of tornadoes last year and, compared to previous years, losses from North Atlantic hurricanes were moderate. The reinsurer pointed out, however, that, as in 2010, this was purely by chance. At 18, the number of recorded tropical cyclones in this season was some way above the long-term average (11) and above the average for the current warm phase with increased hurricane activity since the mid-1990s (15).
The reinsurer said that another 'striking feature' of this year was that, for the first time ever, US weather agency NOAA categorised a low-pressure system over the Mediterranean as a tropical storm. The low-pressure system Rolf formed on 3 November. It was caused by a ridge of cold air forming over the still warm sea (20°C). With peak wind speeds of 120 km/h, the storm '01M' made landfall on the French Mediterranean coast before dispersing. The storm produced extreme rainfall along the Cote d'Azur.
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