Global Insured Losses from Natural Disasters Top $102B, Aon Reports

Aon's third-quarter catastrophe report shows that global insured losses from natural disasters have already surpassed $102 billion through the first 9 months of 2024, positioning annual insured losses to likely exceed 2023's $125 billion. Aon's third-quarter Global Catastrophe Recap—October 2024 report tracked 280 significant disaster events globally from January through September, leading to economic losses of approximately $258 billion, with insured losses notably lower than the $351 billion recorded during the same period in 2023.

The United States saw 26 separate billion-dollar events, driven mainly by severe convective storms and three costly Atlantic hurricanes in the third quarter. Meanwhile, Canada experienced its most expensive insurance loss year to date, incurring over $5.9 billion in damages from four key events within a single month in the third quarter. In Asia, Typhoon Yagi stands out as both the deadliest event of the year and Vietnam's costliest disaster to date.

Despite the high volume of losses, the report notes that no single event has yet impacted the reinsurance market to the extent seen in previous years. Reinsurers are benefiting from strong returns as primary insurers continue to retain the majority of losses.

Aon's report highlights a 60 percent global protection gap, one of the lowest in recent records, largely due to the elevated role of insured losses in the United States, where insurance penetration rates are comparatively high. Fatalities from natural disasters through the third quarter were also low, estimated at 13,000, marking the lowest disaster fatality count since 1986.

"Our latest study highlights the complexity of natural catastrophe risk management for organizations, necessitating a myriad of resources around physical measures, warning systems, forecasts, and public awareness. The insurance industry has again played a significant role in this process, with re/insurance covering a high proportion of the global losses so far this year relative to previous periods," said Michal Lorinc, head of catastrophe insight at Aon. The report projects that global reinsurer capital, which was near $700 billion at midyear, will continue to grow into 2025 barring further major catastrophic events.

The complete Q3 Global Catastrophe Recap—October 2024 report is available on Aon's website.