Global insured losses from natural disaster events in the first quarter of 2024 are estimated to reach at least $17 billion, according to Aon’s “Q1 Global Catastrophe Recap” and Gallagher Re’s “Natural Catastrophe and Climate Report: Q1 2024.” The expected total is close to the average since 2000 ($16 billion) and notably higher than the median ($12 billion) for the period. However, according to the Aon report, “It is a significant drop from the exceptional losses in Q1 of 2023, which were driven by the elevated SCS [severe convective storm] activity in the United States.” There were at least four billion-dollar events, and due to “expected loss development, additional events might cross the threshold.” Most of the global losses, according to the Aon report, were generated by SCS and winter weather events in the U.S. in the first quarter.
Economic Losses
Global economic losses due to natural disasters in the first quarter of 2024 are estimated to be at roughly between $43 billion and $45 billion, the reports state. This is nearly 50% higher than the long-term mean, but 20% lower than the recent decadal average since 2014 ($55 billion), notes the Aon report.
“The number of billion-dollar events was 12, eight of which occurred in the United States, two in South America, and two in Asia,” according to the Aon report, although it notes that the numbers are subject to change as individual loss estimates evolve even months after the date they occur.
The costliest event of the first quarter, the Aon report continues, was the Noto earthquake in Japan on Jan. 1, which “generated over $17 billion of losses, based on preliminary governmental estimates. …This was one of the largest crustal earthquakes impacting mainland Japan in the past 100 years,” the Aon report finds. The Gallagher Re report, however, reports a tentative estimate of $12 billion in direct economic losses.
The Noto earthquake “is followed by the extensive severe convective storm outbreak that impacted parts of the United States in mid-March. Among the costliest events was also a winter weather event that predominantly impacted China in early February,” according to the reports.
Gallagher Re notes in its report, “When looking solely at weather and climate-related disaster costs, which means excluding losses associated with earthquakes, volcanoes, or other non-atmospheric driven events, the economic cost was minimally $31 billion. This was lower than the decadal average [of $43 billion].”
The Gallagher Re report also notes that “On an overall regional basis, the U.S. accounted for a minimum of $21 billion, or 49%, of economic disaster costs in Q1…Asia accounted for at least $17 billion, or 40%, of economic disaster costs in Q1. This was notably higher than the last decade’s average ($8 billion). Europe, Oceania, and Latin America were each well below its recent Q1 average.
Looking Ahead
“As we enter Q2 and Q3, there will be close focus on the expected quick transition from El Niño and La Niña conditions in the central and eastern Pacific Ocean. This has resulted in early projections for a potentially hyperactive Atlantic hurricane season. Whether this translates to more U.S. landfalls is the critical question,” states the Gallagher Re report. Furthermore, the report notes that 2024 is currently projected to be one of the top three warmest years on record.