APAC nat cat losses breach $70b in 2022

Insured losses rose to $10b.

Asia Pacific suffered $70b losses to natural catastrophes, with insured losses rising to $10b in 2022, a report by Munich Re said

Industrialised countries accounted for a high proportion of insured losses. Apart from the floods in Australia, an earthquake in Japan not far from the site of the 2011 Tohoku earthquake was the disaster with the highest insured losses in the region. The quake had a magnitude of 7.4, according to JMA (Japan Meteorological Agency), and caused overall losses of $8.8b, of which $ 2.8b was insured.

Twelve years ago, a much stronger earthquake triggered a devastating tsunami and ultimately caused the Fukushima nuclear disaster. In terms of overall losses, this year’s earthquake was the second-costliest natural disaster in the Asia-Pacific region after the floods in Pakistan.

The report said that in many instances, disaster losses in developing countries in Asia are almost totally uninsured. On the subject of the extreme financial consequences of natural disasters in poorer countries like Pakistan.

Meanwhile, in China, a protracted heatwave and drought, with temperatures of over 44°C in many parts of the country, led to water shortages and crop failures. The water level in the Yangtze, the longest and economically most important river in the country, receded significantly, as did the levels in many other rivers and reservoirs. In some areas, shipping was suspended and the electricity yield from key hydroelectric stations fell drastically. Several large industrial corporations had to temporarily suspend production. 

According to rough estimates, the damage, including losses from crop failures, could be in the mid-single-digit billions, virtually none of which will have been insured. 

“Two factors should be kept in mind when considering the 2022 natural disaster figures. Firstly, we are experiencing La Niña conditions for the third year in a row1. This increases the likelihood of hurricanes in North America, floods in Australia, drought and heatwaves in China, and heavier monsoon rains in parts of South Asia. At the same time, climate change is tending to increase weather extremes, with the result that the effects sometimes complement each other”, Ernst Rauch, Chief Climate Scientist at Munich Re said.