Climate change is showing its claws: The world is getting hotter, resulting in severe hurricanes, thunderstorms and floods

• 2024 was a loss-heavy year for the insurance market, with natural disasters causing US$140bn in insured losses; since 1980, only two years have been more expensive
• Weather catastrophes were dominant, with powerful hurricanes, severe thunderstorms and floods driving the losses
• 2024 will replace 2023 as the hottest year to date, with temperatures around 1.5°C higher than in the pre-industrial era

Morristown, NJ (May 1, 2025) – Worldwide, natural disasters caused losses of US$ 320bn in 2024 (2023, adjusted for inflation: US$ 268bn), of which around US$ 140bn (US$ 106bn) were insured. The overall losses and, even more so, the insured losses were considerably higher than the inflation-adjusted averages of the past ten and 30 years (total losses: US$ 236/181bn; insured losses: US$ 94/61bn). In terms of insured losses, it was the third most expensive year; in terms of total losses, 2024 ranks fifth on the cost scale since 1980.

One record-breaking high after another – the consequences are devastating. The destructive forces of climate change are becoming increasingly evident, as backed up by science. Societies need to prepare for more severe weather catastrophes. Accordingly, Munich Re is expanding and adapting its risk models to address these developments. This allows us to maintain, and even expand, our substantial risk capacity, helping to close the protection gap. At its core, insurance puts a price tag on the risks, which further encourages prevention.
Thomas Blunck, Member of the Board, Munich Re

Weather catastrophes were responsible for 93% of overall losses and 97% of insured losses. Around 11,000 people lost their lives as a result of natural disasters in 2024 – significantly fewer than the average.

Losses from non-peak perils such as floods, wildfires, and severe thunderstorms were yet again substantial, producing total losses of US$ 136bn, of which around US$ 67bn were insured. Although this was slightly below the figures from the previous year (US$ 143bn, of which insured losses totalled a record US$ 82bn), it was well above the average figures of the past ten years (inflation-adjusted US$ 110bn/48bn). It is striking that, from a long-term perspective, non-peak perils are increasingly fuelling the trend of rising losses, while peak risks like tropical cyclones and earthquakes continue to be a source of loss volatility.

In 2024, tropical cyclones alone contributed US$ 135bn to the total losses and US$ 52bn to the insured losses. The majority of these losses were caused by major hurricanes in the USA (US$ 105bn, of which US$ 47bn were insured).

The most devastating natural disasters of the year

Hurricanes Helene and Milton, which struck the USA in rapid succession in September and October respectively, were the most destructive disasters of 2024. Helene resulted in the largest overall losses from natural disasters in 2024 at US$ 56bn, US$ 16bn of which were borne by insurers. The category 4 hurricane made landfall in Florida’s Big Bend region. However, Helene’s destructive wind speeds of up to 225 km/h were not the main cause of the high claims burden. In the storm’s wake, severe flooding from heavy rain spread northward into the Appalachian regions from Georgia to North Carolina. More than 200 people lost their lives.

Hurricane Milton was slightly weaker than Helene when it made landfall in Florida only two weeks later, with wind speeds of up to 200 km/h. Nevertheless, it produced the highest insured losses of the year, totalling US$ 25bn – even though it narrowly missed the Tampa metropolitan area. It drove a storm surge into southwest Florida and cut a swathe of wind damage right across the state. This led to a total loss of US$ 38bn.

The third costliest natural disaster of the year in terms of overall losses was an earthquake in Japan on New Year’s Day, which shook the country’s west coast near the sparsely populated Noto Peninsula with a magnitude of 7.5. Numerous buildings collapsed and thousands of people were left without electricity and water for weeks. More than 200 people lost their lives. Overall losses were estimated at US$ 15bn, with insured losses totalling around US$ 2.5bn.

The natural disaster with the highest death toll was Typhoon Yagi: around 850 people were killed when it swept across the Philippines, the Chinese island of Hainan, the southern tip of the Chinese province of Guangdong, Vietnam and Myanmar in September. When it made landfall in China, Yagi had winds of the second-highest typhoon category 4. For Vietnam, it was the most powerful cyclone since systematic local record-keeping began. With total losses of US$ 14bn, Yagi was also one of the most expensive disasters of the year, but only a small fraction was insured – around US$ 1.6bn.

Climate change is taking the gloves off

Hardly any other year has made the consequences of global warming so clear: with annual average temperatures reaching around 1.5°C above pre-industrial levels for the first time, 2024 will surpass the previous record from 2023. This makes the past eleven years the warmest since the beginning of systematic record-keeping.

The impact of man-made climate change on weather disasters has been proven many times over by research: in many regions, severe thunderstorms and heavy rainfall are becoming more frequent and more extreme. Although tropical cyclones are not generally increasing in number, the proportion of extreme cyclones is growing. They, in turn, are rapidly intensifying and bringing extreme precipitation with them.

This was the case for Helene and Milton, where World Weather Attribution studies have shown that both hurricanes were significantly more severe and brought much more extreme rainfall than in a hypothetical world without climate change. For the flash floods in the Valencia region, another study found that climate change made an event with this rainfall intensity twice as likely to occur.

And in the case of the flooding in Brazil, a study came to the conclusion that weather conditions such as those seen this year have become twice as likely due to climate change; as a result, they are becoming more frequent.

“The physics are clear: the higher the temperature, the more water vapour and therefore energy is released into the atmosphere. Our planet’s weather machine is shifting to a higher gear. Everyone pays the price for worsening weather extremes, but especially the people in countries with little insurance protection or publicly funded support to help with recovery. The global community must finally take action and find ways to strengthen the resilience of all countries, and especially those that are the most vulnerable,” says Chief Climate Scientist Tobias Grimm.

Munich Re’s media release contains additional geographical breakdown, expert video and downloads.

About Munich Re

Munich Re is one of the world’s leading providers of reinsurance, primary insurance and insurance-related risk solutions. The group consists of the reinsurance and ERGO business segments, as well as the asset management company MEAG. Munich Re is globally active and operates in all lines of the insurance business. Since it was founded in 1880, Munich Re has been known for its unrivalled risk-related expertise and its sound financial position. Munich Re leverages its strengths to promote its clients’ business interests and technological progress. Moreover, Munich Re develops covers for new risks such as rocket launches, renewable energies, cyber risks and artificial intelligence. In the 2023 financial year, Munich Re generated insurance revenue of €57.9bn and a net result of €4.6bn. The Munich Re Group employed about 43,000 people worldwide as at 31 December 2023. For more information, please visit www.munichre.com.

Munich Re’s NatCatSERVICE collects information from governmental agencies, scientific institutes, associations, the insurance industry, the media and other publicly available sources in order to analyse nat cat losses. NatCatSERVICE applies Munich Re’s comprehensive in-house nat cat expertise and market data from the worldwide insurance markets to its analyses. Munich Re assumes no guarantees as to the accuracy of this data, which is collected as of specific dates and can also change at any time. The information may not be used as the basis for any decision without prior professional advice and careful contextual analysis. Munich Re is not liable for damages arising from any decisions that third parties may take on the basis of this information.

Market loss estimates from similar events cannot serve as the sole basis for estimating Munich Re’s share, as the loss pattern and underwriting strategy in the respective regions may differ from event to event.

This media release contains forward-looking statements that are based on current assumptions and forecasts of the management of Munich Re. Known and unknown risks, uncertainties and other factors could lead to material differences between the forward-looking statements given here and the actual development, in particular the results, financial situation and performance of our Company. The Company assumes no liability to update these forward-looking statements or to make them conform to future events or developments.

SOURCE: Munich Re

Tags: climate change, Munich Re