Losses arising from catastrophes for private and public insurers will top at least $14bn in the first-quarter of 2022, says a new report from re/insurance broker Aon.
The report, the Q1 Global Catastrophe Recap, states that total economic losses in Q1 2022 were $31bn around the world, with just under half of this covered by public and private insurers. The firm also noted that this year is the sixth in a row that Q1 losses have topped $10bn.
“However,” the report’s authors add, “it is important to remind that these totals are expected to be upwardly revised, perhaps considerably, in the coming weeks and months. This type of loss development is standard and expected in the aftermath of larger scale events.”
The report highlighted several weather events to be significant. These included the February windstorms across Europe, which it called the costliest event of Q1 2022 and which caused losses of more than $4.3bn for insurers; the March earthquake in Japan likely to incur losses of over $2bn; the severe convective storm outbreaks in the US in the same month, which are set to have a loss going into the billions of dollars; and the extensive flooding in Australia.
The report’s authors tried to foster a picture of the overall landscape.
They wrote: “Years with elevated Q1 economic losses have often been amplified by major earthquake events, such as 1994 (United States), 2010 (Chile and Haiti), 2011 (Japan and New Zealand), 2020 (Croatia), and 2021 (Japan). In recent years, however, the growing impactful nature of ‘secondary perils’ such as winter weather, flooding, and severe convective storm have accounted for a significant portion of the overall quarterly economic cost.”
They added: “This reinforces the question as to whether the term ‘secondary peril’ has become obsolete because the losses associated with these perils are impacting more populated communities with increasing intensity and resulting in higher loss costs.”
This takes place against a backdrop in which the combined Q1 losses for 2021 and 2022 were the second highest on record after those between 2020 and 2021. The latter period saw losses of $36bn, compared to the earlier $40bn. However, both these figures were driven by the $25bn loss in Q1 2021.