Worldwide, natural disasters caused substantially higher losses in 2021 than in the two previous years. Based on provisional data, storms, floods, wildfires and earthquakes destroyed assets worth USD 280 billion. Losses in the previous year amounted to USD 210 billion, while in 2019 they were USD 166 billion. Roughly USD 120 billion of losses were insured, which was also more than in the two previous years (2020: USD 82 billion, 2019: USD 57 billion). The insurance gap, in other words the uninsured portion, declined slightly due to a higher proportion of losses in the USA, but was still approximately 57%. Almost 10,000 people lost their lives in natural disasters in 2021, a death toll comparable with those of recent years.
On a global level, around 57% of losses from natural catastrophes in 2021 were not insured. Those affected must bear the financial losses themselves or rely on aid. This insurance gap has declined over the last few decades in industrialized countries, whereas in poorer countries it remains unchanged at over 90%.
"The 2021 disaster statistics are striking because some of the extreme weather events are of the kind that are likely to become more frequent or more severe as a result of climate change. Among these are severe storms in the USA, including in the winter half-year, or heavy rain followed by floods in Europe. For hurricanes, scientists anticipate that the proportion of severe storms and of storms with extreme rainfall will increase because of climate change. Even though events cannot automatically be attributed to climate change, analysis of the changes over decades provides plausible indications of a connection with the warming of the atmosphere and the oceans. Adapting to increasing risks due to climate change will be a challenge," Ernst Rauch, Chief Climate and Geo Scientist at Munich Re, and head of the Climate Solutions Unit, commented.
Europe: Extreme flash floods with record lossesIn Europe, torrential rainfall in July 2021 triggered exceptionally severe floodings that caused devastating losses in local areas, particularly in western Germany. In the regions affected, the rainfall caused by the low-pressure system "Bernd" was the highest in over a hundred years. In tributaries, such as the River Ahr in the Rhineland-Palatinate, the deluge triggered flash floods that swept away countless buildings. There was also severe damage to infrastructure, such as railway lines, roads and bridges. More than 220 people were killed.
Overall losses came to EUR 46 billion (USD 54 billion), of which EUR 33 billion (USD 40 billion) was in Germany. The insured portion was relatively low because of uninsured infrastructure losses and the limited insurance density for flooding in Germany. EUR 11 billion (USD 13 billion) was insured, of which EUR 8.2 billion (USD 9.7 billion) was in Germany, according to figures provided by the Association of German Insurers. It is the costliest natural disaster in Germany and Europe to date.
Exceptionally high proportion of losses in USA
The USA accounted for a very high share of natural disaster losses in 2021 (roughly USD 145 billion), of which some USD 85 billion were insured. Both overall and insured losses were significantly higher than in the two previous years (Overall losses 2020: USD 100 billion, 2019: USD 52 billion; insured losses 2020: USD 67 billion, 2019: USD 26 billion). In detail:
In December 2021, a series of severe storms across several states in the central and southeastern USA led to exceptionally high losses, especially for the month of December. Dozens of violent tornadoes with wind speeds of up to 310 km/h (190 mph) carved a trail of devastation across six states. Especially hard hit was the town of Mayfield, Kentucky, where a long-track, massive wedge-type EF4 tornado roared through the neighborhood. Large parts of the town, including a candle factory, were completely destroyed. According to initial estimates, overall losses amount to around USD 5.2 billion, with projected insured losses of USD 4 billion. An estimated 90 people were killed.
Tropical storms: The Atlantic hurricane season
The costliest natural disaster in 2021 was Hurricane Ida, which made landfall on 29 August 90 km south of New Orleans as a major hurricane (Category 4, the second-most destructive), with wind speeds of around 240 km/h (150 mph). Tens of thousands of buildings were damaged or destroyed. The New Orleans levee system, which was strengthened following Hurricane Katrina in 2005, withstood the storm surges, thereby preventing much higher losses.
Hurricane Ida then tracked to the northeast, causing severe flooding, in particular in New Jersey and the New York City metropolitan area. Overall, Hurricane Ida caused losses of USD 65 billion, of which approximately USD 36 billion were insured (55%). A total of 114 people lost their lives.
Hard on the heels of the previous record-setting 30 named tropical storms in 2020, storm activity during the 2021 hurricane season was again significantly above the long-term average (14.3 for the period 1991 to 2020), with 21 named tropical storms.
In February, an exceptional cold wave brought icy temperatures as far as the southern USA. A temperature of -8?C (17?F) was recorded in the southern Texas city of Houston. Although the state of Texas experiences a major freeze event about once a decade, the state's energy, infrastructure and buildings are often inadequately prepared for such conditions. Millions of people were left without electricity. Overall, with losses of USD 30 billion (half of which were insured), the event was the year's third-costliest natural disaster.