Worldwide insured losses from January to June are expected to be at least $US100 billion ($150 billion), a 14-year high, Aon’s latest Global Catastrophe Recap says.

The half-year figure is topped only by 2011’s $US140 billion ($210 billion). The average for the period is $US41 billion ($61.5 billion).

More than 90% of the insured losses were in the US, driven by the Palisades and Eaton fires in California and severe convective storms.

At least 19 events – all in the US aside from European storms in June – passed $US1 billion ($1.5 billion) of insured losses.

In all other regions, economic losses were below long-term averages, although Australia had an active tropical cyclone season with eight systems reaching at least category 3 intensity and four named storms making landfall.

The most significant was Ex-Cyclone Alfred in southeast Queensland in March – the first cyclone to hit the region since Wanda in 1974. It led to insured losses of $1.4 billion, according to Aon.

The broker says long-term trends indicate a drop in the number of landfalling tropical cyclones in Australia, but recent events “emphasise the complexity of the changing climate risk”. A southward shift or slower storm movements could “enhance damage potential, especially in high-population regions like Brisbane and the Gold Coast.

“Cyclone Alfred has illustrated these dynamics, as its track brought it unusually far south, resulting in landfall in a region that historically experiences few direct cyclone hits.  

“This anomalous track may have been influenced by exceptionally warm sea surface temperatures in the Coral Sea, with 2024 the warmest year on record in the area.”

Alfred was Australia’s fourth most expensive cyclone on a normalised basis, behind Yasi in 2011, Debbie in 2017 and Gabrielle in 2023.

Recent cyclonic severity has amplified pressure on the insurance sector, Aon says. Rebuilding costs across Australia are up 20%-30% since 2022, which is “a major concern”.

“Material costs and labour shortages mean the overall cost of claims has risen significantly and pushed insurers to re-evaluate underwriting pricing approaches.”

At least 7700 people died in natural disasters in the first half, most of them in the Myanmar earthquake in March. The quake caused economic damage of $US12 billion ($18 billion), but insurance coverage was less than $US100 million ($150 million).  

See the Aon report here. 

From the latest Insurance News magazine: Find out just how close the east coast came to disaster when Cyclone Alfred swept ashore