Natural Disaster Losses Hit Five-Year High in April: Aon Catastrophe Report

The global economy suffered the worst April natural disaster losses for five years, according to Impact Forecasting, Aon Benfield’s catastrophe model development team.

Earthquakes, convective storms and flooding contributed to the worldwide devastation, said Impact Forecasting, noting that a significant proportion of these catastrophe losses was uninsured.

The report, titled “Global Catastrophe Recap – April 2016,” said that two major earthquakes struck southern Japan during the month, causing massive devastation and killing at least 66 people, with more than 4,000 others injured.

Total economic losses, including physical damage to residential and commercial structures, vehicles and infrastructure, and business interruption, are expected to exceed 1.12 trillion Japanese yen (USD10 billion), said the report.

The General Insurance Association of Japan reported that nearly 70,000 non-life claims had been filed, as total insured losses were expected to breach 225 billion Japanese yen ($2.0 billion), the report said.

Meanwhile, a major magnitude-7.8 earthquake struck Ecuador’s northwest coast on April 16, killing at least 660 people and injuring more than 17,638 others. According to government figures, the total economic cost for the damage and reconstruction was expected to be above $3.0 billion.

Given low insurance penetration levels, the insured loss was set to be a fraction of the overall financial cost, the report said.

“The global footprint of natural disaster losses in April was significant. Between major events such as the Kumamoto earthquake, the severe convective storms and flooding in the United States, and flooded agriculture in Argentina, economic and insured losses are poised to make this the costliest April since 2011,” said Steve Bowen, Director at Impact Forecasting.

“The large differential between the economic and insured losses is yet another reminder of how much opportunity exists for the insurance industry to help engage with governments, communities and businesses around the world to provide the risk expertise that can help mitigate the effects of natural disasters,” he said.

Natural hazard events occurring elsewhere during April include:

Source: Impact Forecasting