According to initial estimates from the forthcoming Swiss Re sigma study on catastrophes, more than 238,000 people lost their lives to natural catastrophes and man-made disasters in 2008 – the fourth largest number of deaths since 1970. While the total cost to society was $225 billion, $50 billion was covered by property insurance, making 2008 the second costliest year ever in terms of insured losses.
“In 2008, large loss events tragically claimed over 238 000 lives,” said Swiss Re. “In early May, tropical cyclone Nargis struck Myanmar, killing 138,400 people, setting off one of the largest humanitarian crises in recent memory. Later in May, a devastating earthquake measuring 7.9 on the moment magnitude scale shook China’s Sichuan region, killing 87,400 people and leaving over 10 million homeless. Most of the losses from these two events were not insured.”
Property insurers will face claims of over $50 billion:
Catastrophes cost insurers more than $50 billion in 2008, making it the second costliest year in insurance history.
Of the total amount, natural catastrophes accounted for $43 billion, with storms costing insurers $39 billion. Hurricanes in the US and the Caribbean triggered record losses, with Hurricane Ike resulting in claims of $20 billion, followed by Hurricane Gustav at $4 billion (insured losses include property, motor, offshore damage and flood losses covered by the NFIP).
In Europe, winter storm Emma caused damages of $1.4 billion, which are significantly lower than those caused by last year’s winter storm Kyrill ($6 billion).
Man-made Catastrophes around $7 billion:
Man-made disasters continued to be costly for the insurance industry in 2008. Explosions and major fires resulted in losses of $4.8 billion. Damages to industry and industrial warehouses accounted for approximately $2.1 billion of this amount, while oil and gas-related incidents – excluding offshore damage from hurricanes – cost insurers another $1.5 billion.
Catastrophes in 2008 cost society $ 225 billion. This figure includes both insured and uninsured losses to buildings, infrastructure and vehicles. The Sichuan earthquake was the costliest at $85 billion. Hurricane Ike ranked second ($40 billion), followed by snowstorms and freezing rain across China ($20 billion).
In terms of man-made disasters, a ruptured pipeline on Varanus Island in Western Australia in June 2008 was one of the costliest, resulting in losses to industry and the local economy of at least $1.8 billion.
The complete release, including charts, graphs and further details may be obtained on the Swiss Re web site at: www.swissre.com. The full sigma study is due for release after the first of the year.
Source: Swiss Re
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