Natural disaster losses hit RM1t in 2022

WHEN Hurricane Ian barrelled into Florida in September, bringing extreme winds and torrential rains, it caused between US$50 billion and US$65 billion (RM286.32 billion) in insured damages. That makes it not only this year’s cost-liest natural disaster but the second-costliest insured loss ever after 2005’s Hurricane Katrina, according to a report from the Swiss Re Institute, the research arm of the reinsurance giant. 

The annual report, which looks at losses from natural catastrophes such as floods, hurricanes and wildfires, estimates the total economic losses will reach US$260 billion in 2022. That’s down 11% from last year, but still well above the 10-year average of US$207 billion. Only a portion of the 2022 damage was insured, but the insured losses follow a similar trend. They are expected to come to US$115 billion this year, 6% below last year but higher than the 10-year average of US$81 billion. 

Insured losses have been on a long-term upward trend for a while, according to the Institute, and extreme events caused by climate change shoulder much of the blame. 

“Extreme weather events have led to high insured losses in 2022, underpinning a risk on the rise and unfolding on every continent,” Martin Bertogg, the reinsurer’s head of catastrophe perils, said in a statement. “When Hurricane Andrew struck 30 years ago, a US$20 billion loss event had never occurred before — now there have been seven such hurricanes in just the past six years.” 

Climate change is warming oceans and super-charging storms. This year saw relatively few major hurricanes in the US, but the report highlights the threat of even one major hurricane hitting a densely populated coastline, as Ian did. — Bloomberg

  • This article first appeared in The Malaysian Reserve weekly print edition

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