By AFP - Agence France Presse
Natural disasters will cause economic losses of $310 billion in 2024: Swiss Re.
By Nathalie OLOF-ORS
In a year expected to be declared the hottest on record, natural disasters will cause economic losses of $310 billion worldwide in 2024, as climate change increasingly takes its toll, Swiss Re said on Thursday.
Estimated economic losses from natural disasters were six percent higher than in 2023, which is currently the hottest year on record, the Zurich-based reinsurance giant said in a statement.
Of the total, insured losses rose 17 percent year-on-year to $135 billion, with devastating hurricanes Helene and Milton in the United States and intense flooding in Europe driving up costs, it said.
This is the fifth consecutive year that insured losses have exceeded $100 billion, the Swiss company said.
“A large part of this growing loss burden results from the concentration of value in urban areas, economic growth, and rising reconstruction costs,” Balz Grollimund, Swiss Re's head of catastrophe and risk, said in the statement.
Swiss Re, which acts as an insurer of insurance companies, emphasized the impact of climate change, with this year set to be declared the hottest since records began.
Just this week, China, the world's leading emitter of the greenhouse gases that scientists say are driving climate change, recorded its hottest fall on record.
Global warming could make extreme weather more frequent and intense, not only because of the high temperatures but also because of the indirect effect of the extra heat in the atmosphere and seas.
“By favoring the conditions that led to many of this year's disasters, climate change is also playing an increasing role,” said Grollimund.
The European Union's climate monitor, Copernicus, said last month that 2024 is likely to be more than 1.55 degrees Celsius (2.8 degrees Fahrenheit) above the 1850-1900 average - the period before fossil fuels were burned on an industrial scale.
This does not represent a violation of the Paris Climate Accords, which strive to limit global warming to less than 2ºC and preferably 1.5ºC, because this is measured in decades and not individual years.
However, scientists claim that the safer limit of 1.5°C is rapidly falling out of reach while emphasizing that every tenth of a degree in temperature increase heralds progressively more damaging impacts.
Swiss Re highlighted, in particular, the rising cost of flood insurance in 2024, which was the third most expensive year for this risk worldwide and the second most expensive year for floods in Europe.
In Europe alone, intense flooding caused around $10 billion in insured losses this year, according to the company, pointing to the major floods following storm Boris in Central Europe in September and the devastating floods in Spain in October, which killed at least 230 people.
The report also highlighted major flooding in the Gulf region in April, which disrupted operations at Dubai Airport, the world's busiest international hub.
The United States recorded the highest insured losses this year.
Hurricanes Helene and Milton hit the southeastern United States in quick succession in late September and early October.
They alone resulted in insured losses estimated at around $50 billion, Swiss Re reported.
Together with a high frequency of severe storms, this means that the United States was responsible for at least two-thirds of the total global insured losses for 2024, according to its estimates.
Swiss Re warned that global insured losses will certainly continue to rise.
“Losses are likely to increase as climate change intensifies extreme weather events, while asset values increase in high-risk areas due to urban sprawl,” it said.
“Therefore, adaptation is key, and protective measures such as dikes, dams, and floodgates are up to 10 times more cost-effective than reconstruction.”
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