The Heat Is Online

Warming Drives Surge in Insurance Losses

2004 Natural Disasters Death Toll Doubles

 Planetark.org, Feb. 28, 2005

FRANKFURT - Natural catastrophes killed over 180,000 people in 2004, twice as many as in 2003, with an economic cost of $145 billion, German reinsurance giant Munich Re said in its annual review of disasters on Thursday.

Of the $145 billion loss last year, insured losses were around $44 billion, of which $40 billion was due to destructive hurricanes in the Caribbean and the United States and typhoons in Japan.

In comparison, the economic loss due to the South Asian tsunami was lower but the human cost far higher.

"According to official sources, the catastrophe triggered by a magnitude 9.0 earthquake claimed the lives of over 170,000 but, in view of the large numbers of people still missing, there are fears that the figure will exceed 250,000," Munich Re, the world's biggest reinsurer, said in a statement.

Current estimates put the overall economic loss from the Tsunami at over $10 billion, the insured loss at around $1-2 billion, and the Munich Re Group's burden at less than $100 million, it said.

Munich Re said extreme weather events were the main source of destruction and financial loss last year and may be linked to global warming.

"These events are further evidence that a correlation between global warming and the considerable rise in the number of extreme weather events is becoming increasingly plausible," Peter Hoeppe, head of Geo Risks Research at Munich Re, said in the statement.

"The insurance industry must adjust the scope and price of its insurance covers to the growing risk," he added.

In addition to the unusually large number of hurricanes and typhoons last year, there were also cyclones in parts of the Atlantic where they are not typical, the company said.

Despite the sharp jump in the number of lives lost in 2004, the number of natural catastrophies analysed, at 650, was no higher than the average of the last 10 years, it added.