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Region hit by US$7bn economic losses from Nat CATs in 1H

In the Asia-Pacific region, natural disasters in the first six months of this year resulted in overall losses of approximately $7bn, of which roughly $3bn was insured, says Munich Re.

In a report on natural disaster figures for the first half of 2023, Munich Re says that in New Zealand, high losses were caused by flooding following heavy rainfall, as well as Cyclone Gabrielle making landfall. Assets worth some $4.3bn were destroyed, of which around $2.9bn was insured.

Large areas of China and Southeast Asia suffered recurrent heat waves between March and June, breaking many local and seasonal records. Tianjin, a city with over 10 million inhabitants, measured a record high of 41.4ºC.

For Asia as a whole, the months of February to June were the fourth warmest on record, as was June alone. Globally, insurers bore around 35% of worldwide losses in terms of the average half-year losses in the period 2013–2022.

The first half of 2023 was a continuation of the recent run of years with high losses. While the overall losses of $110bn were lower than those in the first half of 2022 ($120bn), they were still well above the average for the last 10 years ($98bn, inflation-adjusted). The same is true for the insured losses of $43bn (previous year: $47bn; 10-year average for half-year losses: $34bn).

Less than 40% of overall losses in the first half of the year were insured – evidence of the large insurance gap that persists in many countries for multiple natural hazards.

Costliest natural disaster in 1H

The earthquake in Turkey and Syria was by far the most devastating natural disaster in the six months of the year. On 6 February, a series of tremors struck southeastern Turkey close to the border with Syria. They were the strongest earthquakes in Turkey in decades. A very large number of buildings, roads and bridges were destroyed. Around 58,000 people lost their lives.

As a result, the global number of victims of natural disasters in the first half of the year (some 62,000) was higher than it had been since 2010.

Overall losses from the earthquakes in both countries are estimated at around $40bn, with Syria accounting for roughly $5bn.

Climate change and El Niño – 2023 could be the warmest year ever

“The effects of climate change are having a stronger and stronger impact on our lives. The first half of 2023 was characterized by record temperatures in many regions of the world, very high water temperatures in various ocean basins, droughts in parts of Europe, and severe wildfires in northeastern Canada,” said Ernst Rauch, chief climate and geoscientist at Munich Re. The global average temperature for June was the warmest ever recorded, up by more than 1.2°C compared to pre-industrial times.

“As in 2016, the natural climate phenomenon El Niño is playing a role in 2023. It is characterized by a temperature swing in the Pacific that influences extreme weather in many regions of the world and causes temperatures to temporarily rise further. All the same, research on global temperature trends is unequivocal: rising water and air temperatures worldwide are mainly driven by climate change, in turn causing more weather-related natural disasters and financial losses,” Mr. Rauch added.



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