Global insurance and re-insurance group Munich Re has said that natural catastrophes in 2010 caused losses of US$ 130bn.

In its overview of the cost of natural catastrophes worldwide in 2010, Munich Re said that very severe earthquakes and many severe weather events had resulted in substantial losses and an exceptionally high number of fatalities. The high number of weather-related natural catastrophes and record temperatures both globally and in different regions of the world provided further indications of advancing climate change.

Altogether, a total of 950 natural catastrophes were recorded last year, nine-tenths of which were weather-related events like storms and floods. The total makes 2010 the year with the second-highest number of natural catastrophes since 1980, markedly exceeding the annual average for the last ten years (785 events per year). Overall losses amounted to around US$ 130bn, of which approximately US$ 37bn was insured. This puts 2010 among the six most loss-intensive years for the insurance industry since 1980. The level of overall losses was slightly above the high average of the past ten years.

"2010 showed the major risks we have to cope with. There were a number of severe earthquakes. The hurricane season was also eventful – it was just fortunate that the tracks of most of the storms remained over the open sea. But things could have turned out very differently", said Torsten Jeworrek, Munich Re's Reinsurance CEO. "The severe earthquakes and the hurricane season with so many storms demonstrate once again that there must be no slackening of our efforts to analyse these risks in detail and provide the necessary insurance covers at adequate prices. These prices calculated by the insurance industry make it possible to assess the economic consequences of these otherwise difficult-to-evaluate risks."

Five major catastrophes dominate losses

In all, there were five catastrophes last year assignable to the top category of "great natural catastrophes" based on the definition criteria of the United Nations: the earthquakes in Haiti (12 January), Chile (27 February) and central China (13 April), the heatwave in Russia (July to September), and the floods in Pakistan (also July to September). These accounted for the major share of fatalities in 2010 (around 295,000) and just under half the overall losses caused by natural catastrophes.

One of the most devastating earthquakes in the history of the past 100 years, the quake in Haiti on 12 January killed more than 220,000 people. However, whilst the earthquake in Haiti resulted in human tragedy on a staggering scale, it gave rise to only negligible losses for the insurance industry - often the case in developing countries.

Pakistan floods cost $9.5 billion

In the summer, floods following extreme monsoon rainfall had devastating consequences in Pakistan. For weeks, up to one-quarter of the country was flooded. The overall loss totalled US$ 9.5bn – an extremely high amount for Pakistan's emerging economy.

Asia and America most frequently affected by catastrophes

The global distribution of natural catastrophes in 2010 was comparable to that of previous years. Most catastrophes occurred on the American continent (365) and in Asia (310). 120 natural catastrophes were recorded in Europe, 90 in Africa and 65 in Australia/Oceania. North and South America also accounted for the largest portion of insured losses, namely around two-thirds.

Some 17% of the losses were incurred in Europe, where the most expensive individual event was Winter Storm Xynthia, which mainly affected Spain and France and caused overall losses of US$ 6.1bn (€ 4.5bn). As is usual with windstorms in Europe, the share of insured losses was very high, totalling US$ 3.1bn (€ 2.3bn).