The Cost of Disasters in 2011
At the beginning of the year I wrote about the enormous cost of disasters in 2010 and asked the question “What will 2011 bring?” Worldwide, man-made and natural disasters in 2010 cost $218 billion, and of that figure cost the insurance industry $43 billion. The $218 billion figure far overshadowed the $68 billion in damages in 2009. Well, what did 2011 bring?
According to Swiss Re, 2011 brought an estimated record of $350 billion in damages. Of that insurance and reinsurance is likely responsible for less than one-third of the damages at $108 billion. If that figure stands it will be the second-most costly year for the insurance industry portion behind 2005, when Hurricane Katrina hit. This would have been a record year but there was relatively low insurance coverage for earthquake and tsunami damage in Japan.
Earthquakes this year led the way for the most costly disasters. The earthquake and tsunami in Japan was first followed by the earthquake in New Zealand. After the earthquakes, severe storms and tornados in the U.S. followed by Hurricane Irene caused billions in damage.
2011 was a record year for disasters. Only time will tell what’s in store for next year.