Gallagher Re has estimated that global insured losses from natural catastrophes in Q1 of 2024 were $20 billion, heavily driven by severe convective storm (SCS) activity in the US.
According to the global reinsurance broker’s Natural Catastrophe & Climate Report, insured losses in Q1 2024 were 10% higher than the decadal average of $18 billion.
A news report from Reinsurance News, an industry-focused online medium, Gallagher Re reported however, when excluding losses from earthquakes, volcanos and other non-atmospheric-driven events, insured losses in Q1 were estimated at $17 billion – equal to the decadal average.
Meanwhile, total economic losses from all natural perils in Q1 were $43 billion, 17% lower than the most recent 10-year Q1 average.
Gallagher Re reported: “Q1 was defined by major events such as several billion-dollar SCS outbreaks in the US, a USGS-registered magnitude-7.5 earthquake in Japan and an active European windstorm season. However, the overall financial costs from natural catastrophes to start 2024 were manageable for the private insurance market and public insurance entities.”
Still, the firm’s report observed that US SCS continued to lead the way as the costliest peril to start 2024 following a record year in 2023.
Q1 reportedly marked the second-most expensive quarter for SCS at an estimated $11 billion in global insured losses — behind the $15 billion in Q1 2023.
The reinsurance brokerage firm disclosed that the US accounted for more than $10 billion of the Q1 2024 total and at least three individual billion-dollar insured loss SCS events alone, including the quarter’s costliest insured event.
It further clarified: “The first three months of the year saw non-peak perils (e.g. SCS, flooding, winter weather, wildfire, and drought) account for more than double the economic costs for peak perils such as tropical cyclone, earthquake and European windstorm. Non-peak perils’ surpassing peak perils in Q1 economic losses is a continuing trend that has extended back at least a decade.”
In his remarks, Gallagher Re’s Chief Science Officer, Steve Bowen, said: “Looking forward, while 2024 has resulted in a manageable start for natural catastrophe losses, the spring and summer months across the Northern Hemisphere often bring more volatile weather or climate-related activity.
“There is already heightened awareness of the looming Atlantic hurricane season and the current atmospheric/oceanic conditions that may spawn above-average storm activity.
“While not every La Niña behaves the same way, we have consistently seen the influence of climate change on the various phases of ENSO that fuels more extreme weather behaviour. Preparation, investment and adaptation remains imperative in the face of increasing risk”, Bowen added.
