Global losses from disasters in 2016 totaled $175 billion USD – two-thirds more than the previous year. Much of that was the result of flood-related damage, particularly in areas that fall in the “protection gap.”
According to Munich Re, 2016 was the costliest in the last four years, following there years of relatively low natural catastrophe losses. The high number of flood events – including river flooding and flash floods – accounted for 34% of overall losses. That’s a notable increase over the average 21% seen in the previous 10 years.
The report points to the large share of uninsured losses in both developing countries and emerging markets as an ongoing concern, particularly since the risk knowledge of the insurance industry would help alleviate financial burdens and bear a greater portion of catastrophe-related risks.
This connects to the recent flooding in the U.S. Gulf Coast, where total economic losses were estimated up to $15 billion, and because of regionally low participation in the National Flood Insurance Program, more than 80% of damaged homes lacked flood insurance.
Deaths from these catastrophes totaled about 8,700, far fewer than 2015’s number of 25,400 – making it the year with the second fewest fatalities in 30 years (after 2014’s 8,050).
The five costliest catastrophes in 2016:
- Kumamoto earthquakes, Japan, April – $31 billion
- Flooding, China, June – $20 billion
- Hurricane Matthew, Caribbean, Sept. – $10.2 billion
- Flooding, United States, Aug. – $10 billion
- Flooding, Europe, May – $6 billion