Natural disaster losses fall, but insurance gap and climate risks persist

Natural disaster losses eased in the first half of 2026, but a widening gap between economic and insured losses continues to expose businesses and travellers to significant risks, according to Munich Re.

Worldwide natural disasters generated an estimated US$112 billion in losses from January to June, of which only $44 billion was insured – leaving a 60% protection gap. While losses were broadly in line with the inflation-adjusted 10-year average, Munich Re warned that climate change and growing exposure were increasing the potential for more severe losses.

The costliest event was the double earthquake in Venezuela on 24 June, with total losses estimated at around $30 billion. Less than $1 billion of those losses is expected to be insured.

For insurers, severe thunderstorms in the US were the biggest loss driver, producing around $22 billion in insured losses.

Meanwhile, record-breaking heatwaves in Europe and North America are highlighting an increasingly important risk for business travel. Extreme heat can disrupt transport and infrastructure, reduce productivity, and pose serious health risks, while much of the resulting economic damage falls outside conventional property insurance.

The outlook for the second half of 2026 is also challenging, with El Niño expected to intensify weather extremes in several regions.

Tobias Grimm, Munich Re’s Chief Climate Scientist, said: “It’s a dangerous mix: as global warming continues, the world is also heading for a super El Niño, which will drive temperatures up even further. The effects will likely be clearly felt in the second half of the year. Taking timely precautions saves lives and limits the economic damage caused by disasters.”