AON estimates $7 billion in claims from global disasters

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AON estimates $7 billion in claims from global disasters

Report outlined disasters in Alberta, Europe, the U.S. and parts of Asia

Staff on June 8, 2016

A new Aon report says recent global disasters will lead to at least $7 billion in claims.

The Global Catastrophe Recap report took several May and June disasters into account including the Fort McMurray wildfires, flooding in Europe, severe storms in the United States, as well as a cyclone in parts of Asia.

The Fort McMurray fires became the most expensive natural disaster in Canadian history. The fire destroyed at least 10 percent of the city, including more than 24,000 homes and structures.

Aon estimates insured losses, including physical damage and business interruption, to at least $4 billion. “The severity of the wildfire damage in Fort McMurray is an unfortunate reminder of how significant insurable losses can be from the peril.The situation in Canada has already allowed for a strong and cooperative response from both the government and the insurance industry as residents and business owners seek to assess the damage and begin the recovery process. Since this is just the sixth individual global wildfire to surpass the billion-dollar threshold for insurers, there is not a lot of precedent for a fire event of this magnitude.”

Later in May, storms broke out in Europe devastating several cities and towns, but the most considerable damage was in Germany, France, Austria, Poland and Belgium. The storm called “Elvira” killed at least 17 people. Insurance industry associations in France (AFA) and Germany (GDV) estimated combined minimum claims payouts to be more than 2 billion euros, while the tentative overall economic damage estimated to be around 4 billion euros.

Tornados, winds and large hail affected parts of the U.S. including parts of the Plains, Midwest and Mississippi Valley. Floods also lead to major damages in parts of Texas. Total insured losses were estimated to more than $1 billion U.S.

Meanwhile, Cyclone Roanu ripped through Sri Lanka, eastern India, Bangladesh, Myanmar and China bringing rain, flooding and landslides and killing at least 105 people in Sri Lanka alone. Nearly 125,000 homes and structures were damaged or destroyed across all five countries. The estimated cost of reconstruction was up to $1.7 billion U.S., though insured losses were substantially less given low insurance penetration.

Other natural disasters hit different parts of the world throughout May. Five separate floods hit China causing a total economic loss of over $1.5 billion U.S., mostly in agriculture. Landslides also hit parts of Hispaniola, Kenya, Tajikistan, Afghanistan, Rwanda, Ethiopia, India and Yemen. In the meantime, Tropical Storm Bonnie brought heavy rainfall to portions of the Carolinas and Georgia but economic losses were expected to be small. Finally, earthquakes in Ecuador and China caused damages to thousands of homes and a winter weather outbreak in northern China caused damage to crops totalling $61 million U.S..

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AON estimates $7 billion in claims from global disasters