Flood events dominate natural cat losses in first half of 2013

Natural catastrophe statistics for the first half of this year have been dominated by severe flooding events, although the overall losses were below the average for the last decade, according to Munich Re.

 Overall, the first half of the year had 460 loss-relevant natural hazard events, slightly above the 10 year average of 390, the reinsurer said Tuesday.

But at about $45 billion, natural catastrophe losses for the first half of 2013 are below the 10 year average of $85 billion, the company said. 

Insured losses totalled approximately $13 billion (under the 10 year average of $22 billion). All figures are in U.S. currency.

Roughly 47% of the overall losses and 45% of the insured losses for the first six months of the year were from inland flooding in Europe, Canada, Asia and Australia, according to Munich Re.

Flooding in central Europe, particularly in Germany, caused the most in losses, with an overall loss of about $16 billion and an insured loss in the region of about $3.9 billion, the company said.

“The frequency of flood events in Germany and central Europe has increased by a factor of two since 1980,” noted Torsten Jeworrek, a board member at Munich Re.

“But particularly with floods, an increased hazard – such as more frequent heavy rainfall events – need not necessarily result in higher losses,” Jeworrek added. “Such a rise in losses can be prevented by better flood control.

It is therefore important to sharpen risk awareness. Rivers need room so that flood waves can disperse without causing serious damage. And the flood risk needs to be considered in the designation of land for industrial or residential areas.

Politicians should not only set up emergency funds after catastrophes but should act with greater foresight, engaging in prudent supraregional flood control, which should ideally be coordinated across national borders.”

The weather patterns that led to several major European rivers flooding are becoming more frequent, the head of Munich Re’s Geo Risks Research unit, Peter Hoppe, also noted.

“Debate in climate research is currently focusing on what the causes of such changes in weather patterns could be and what role climate change might play in this,” he added. “But it is naturally not possible to explain single events on this basis.”

Following the European flood events, the second costliest natural catastrophe events so far this year were in Oklahoma, where a squall line with severe tornadoes in May caused about $3 billion in economic losses, and around $1.5 billion in insured losses.

“The central states of the USA have the highest tornado risk in the world,” Hoppe noted. “Altogether, however, the U.S. tornado season has been below average so far: by the end of June, 625 tornadoes had occurred, compared with the longer-term average of 1,075.”

Severe flooding in southern Alberta also marked the first half of the year, where insured losses are likely to exceed $1 billion, the reinsurer said.

India and Nepal have also experienced very severe flooding from monsoon rains, with more than a thousand people being killed.