Asia Pac’s Nat Cat insurance protection gap was nearly double the US in percentage terms in 2024 according to data from Munich Re’s NatCatSERVICE.
The APAC region experienced $88m in economic losses, accounting for a quarter of the global total, but only 12% of these losses were insured. In contrast, in the United States, $99m of the $166m in economic losses was insured, covering approximately 56% of the losses.
While 2024 didn’t see a Nat Cat event in Asia on par with the 2011 Thai Floods, which caused economic losses worth nearly 11% of the country’s GDP, there were a series of major natural disasters in the region over the last 12 months.
In October Typhoon Yagi ravaged Southeast Asia, inflicting over $3trn of damage on Vietnam alone, with neighbouring countries Laos, China, the Philippines, and Myanmar also affected.
Yagi was the world’s worst natural disaster in terms of fatalities in 2024, with 851 deaths but insured losses totalled only US$1.6bn.
The figure for Yagi was lower than the US$2.5bn insured losses recorded for the Noto Peninsula Earthquake ,which Fitch initially described as a ‘small’ event from an insurance perspective.
Flooding in China’s southern provinces in June was the third largest Asia Nat Cat event, with insured losses of $400m, versus economic losses of $12bn.
American exceptionalism
Munich Re’s data showed that while Asia was home to three of the five biggest Nat Cat events of last year in terms of economic losses, the list of biggest Nat Cat events from an insured loss perspective was dominated by the US.
The US saw four of the five biggest Nat Cats by insured losses in 2024, topped by the $56bn losses from Hurricane Helene.
The only non-US Nat Cat event to make the list were the October flash floods in Spain, which caused insured losses of $4.2bn.
In total, natural disasters inflicted $320bn of economic losses globally over 2024, causing $140bn of insured losses, and 11,000 fatalities worldwide.
But these numbers vary widely by region. Asia sustained 25% of the total economic losses ($88bn) but roughly 11% of insured losses. In contrast 56% of US economic losses were covered by insurance.
The numbers show an unmistakable upward trend. The $340bn overall losses for 2024 are well above the inflation adjusted $268bn that Munich Re recorded 12 months earlier, which itself was ahead of the five average ($261bn).
This in turn is higher than the 10 and 30 year averages ($236 and $181bn, respectively).
Achim Kassow, Member of the Board of Management of Munich Re, responsible for Asia-Pacific and Africa said in a press release announcing the data that it showed that consequences of climate change are increasing worldwide.
“Typhoon Yagi, which hit Southeast Asia and Southern China, and extreme flooding in the United Arab Emirates contributed to total losses of around US$ 91bn in 2024, almost 38% higher than the previous year.
Insured losses increased by 60% to US$ 16bn. In addition to supporting catastrophe recovery, insurance quantifies the cost of risk, which can catalyse prevention efforts and help societies build greater resilience,” Kassow said.
