Loss insurance coverage plays a crucial role in disaster recovery efforts

The Ten Most Expensive Natural Disasters In 2013

Natural disasters cost a total of $192 billion in 2013, according to research from Impact Forecasting, a division of reinsurance company Aon Benfield.

Every year, Impact publishes an “Annual Global Climate and Catastrophe Report” detailing the number of natural disasters in the previous year, with estimates about their total costs.
They categorize each event by economic loss and insured loss.

In a press release, Stephen Mildenhall, CEO of Aon Benfield Analytics, said “2013 was an active year for serious catastrophe events but one in which the industry dodged a bullet of a single dominating insured event.”

In 2012, Hurricane Sandy was the costliest event, resulting in an estimated insured loss of $28.2 billion, combining private insurers and government-sponsored programs with approximately $65 billion worth of economic

Category 5 Hurricane

Hurricane storms continue to intensify as global weather patters change.

loss between the United States, Canada, the Bahamas and the Caribbean.

Last year, about 84 percent of economic losses happened outside of the United States, well above the 2003-2012 average of 65 percent. The most expensive event in the U.S. was an EF-5 tornado that hit the city of Moore, Okla., in May — it cost about $3.8 billion in economic losses.

“Typhoon Haiyan, however, demonstrated the real and ever-present potential for large-scale destruction,” Mildenhall added.

Eight of the most damaging natural disasters occurred in Asia last year. The Philippines, Vietnam and China suffered the most losses in 2013 due to Typhoon Haiyan. India and Nepal were both hit by flooding in June that resulted in 6,748 deaths, while an earthquake in Pakistan killed 825 people in September. But the report’s authors note that “given the region’s large land size and susceptibility to natural disaster events, this is to be expected.”

About 35 percent of all global economic losses last year were the result of flooding — the highest rate since 2010. The most expensive event all year was a series of floods in Central Europe, which cost a total of $22 billion in economic losses.

Below are the 10 most expensive natural disasters of 2013, according to the report, ranked by their estimated economic losses.

1.      Flooding In Central Europe Cost $22 billion

After days of rain in late May 2013, there were record amounts of flooding in Germany, the Czech Republic and Austria. Switzerland, Slovakia, Belarus, Poland, Hungary and Serbia were also affected.

According to the report, flood-related damage cost the region $22 billion in economic losses and $5.3 billion in insured losses.

2.      An Earthquake In Lushan, China Cost $14 billion

On April 20, an earthquake hit the small county of Lushan in Sichuan province in southern China. The China Earthquake Networks Center reported it had a magnitude of 7.0.

The economic loss was $14 billion, with just $250 million in insured losses. There were 620,000 claims made and 196 people lost their lives.

3.      Super Typhoon Haiyan Cost $13 billion

The powerful tropical that cyclone hit Southeast Asia on Nov. 8 is reportedly the worst one ever recorded.

Impact research shows that more than 8,000 people were killed or are missing after the storm — which makes it the most fatal event of the year.

However, it still ranks third in terms of economic loss. More than 1.3 million claims were filed and it incurred $13 billion in economic losses, and $1.5 billion in insured losses.

4.      Typhoon Fitow In China And Japan Cost $10 billion

Fitow hit the southern Japanese Ryukyu Islands on Oct. 4, when it had reached a category four status.

It later became one of five typhoons to hit China, and was the costliest one of the season because it spawned major flooding.

In total, it caused eight deaths, resulted in 97,000 claims and cost $10 billion in economic losses and just $1 billion in insured losses.

5.      Droughts In China Cost $10 billion

Drought was one of three incident types that sustained above average losses in Asia last year.

Between January and September, losses from a massive drought in China caused economic losses greater than $10 billion. But “only a fraction of these losses were covered by insurance,” the report reads, “signifying the dearth of penetration in the region.”

6.      A Series of Droughts In Brazil Cost $8 billion

Last year, Brazil experienced one of its worst droughts in decades. A lack of rain between January and May in the country’s northeast region hurt many of the largest Brazilian industries.

Impact estimates that this cost a total of $8 billion in economic losses and $350 million worth of insured loss.

7.      Flooding In Alberta, Canada Cost $5.2 billion

Last June, record amounts of rain overwhelmed southern parts of the province of Alberta, displacing nearly 100,000 people and killing four.

Just 25,000 insurance claims were made. Economic losses reached $5.2 billion and insured losses reached an estimated $1.7 billion.

8.      August-September Floods In Northern China Cost $5 Billion

Heavy rainstorms battered the northeastern region of the country between August and September.

The resulting floods left thousands stranded and 188 deaths were recorded.

The economic losses reached $5 billion, with insured losses of $405 million and an estimated 215,000 claims were filed.

9.      Another Flood In Southwest China Cost $4.5 Billion

In July, southwest China experienced abnormally heavy rainfall. In Sichuan, a reported 37 inches of rain fell between July 8 and 9.

These floods resulted in 375,000 claims, $4.5 billion in economic losses and $150 million worth of insured loss.

10.  Hurricane Manuel In Mexico Cost $4.2 Billion

The 13th named storm of the year started in mid-September and turned into a tropical storm within days.

Formed on September and lasting a week, its highest winds were recorded at 75 miles per hour. At least 169 people were reported killed.

An estimated 35,000 claims were filed. Economic losses were $4.2 billion and insured losses reached $685 million.

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