Natural Disasters in 2024: A Loss-Heavy Year for the Insurance Market

According to Munich Re's update titled Natural Disasters 2024: Climate Change Is Showing Its Claws, 2024 saw insured losses of $140 billion, making it the third most expensive year for the insurance market since 1980. The year was dominated by powerful hurricanes, severe thunderstorms, and devastating floods, with North America experiencing an even greater share of losses than usual.

Per the report, total losses from natural disasters worldwide reached $320 billion in 2024, far exceeding the inflation-adjusted averages for the past decade. Weather-related catastrophes accounted for 93 percent of these losses, highlighting the increasing impact of climate change on natural disasters. Despite the financial toll, the death toll of around 11,000 was significantly below the historical average.

According to Munich Re, hurricanes were the primary drivers of losses, with tropical cyclones contributing $135 billion in total damages and $52 billion in insured losses. Hurricanes Helene and Milton were the most impactful, causing significant destruction in the United States. Helene alone led to $56 billion in total losses, while Milton caused $25 billion in insured damages, the highest of the year.

Munich Re reported that nonpeak perils, including floods, wildfires, and severe thunderstorms, caused $136 billion in total damages, underscoring their growing role in the upward trend of natural disaster costs. While slightly below 2023 figures, these losses far surpassed the 10-year average, signaling a persistent and troubling increase in damages from such events.

North America bore 60 percent of global natural catastrophe losses in 2024, according to Munich Re, with the United States experiencing substantial damages from hurricanes and severe thunderstorms. In Canada, natural disasters caused $10 billion in losses—the highest since 1980—driven by a Calgary hailstorm, flooding from Hurricane Debby, and a wildfire in Jasper National Park.

Per the report, 2024 surpassed 2023 as the hottest year on record, with global temperatures averaging 1.5 °C above preindustrial levels. This milestone underscores the growing influence of climate change, as studies linked events like Hurricanes Helene and Milton, as well as extreme floods in Brazil and Valencia, to a warming planet.

Munich Re emphasized the need for action, with Chief Climate Scientist Tobias Grimm urging global efforts to strengthen resilience, particularly in vulnerable regions. He noted that worsening weather extremes come at a high cost, especially in areas lacking adequate insurance or public recovery funds.