Worldwide, natural disasters in 2023 resulted in losses of around US$250 billion as well as more than 74,000 fatalities, according to insurer Munich Re. Unlike in previous years, there were no mega-disasters in industrialised countries that drove financial losses up. Instead, the loss statistics were characterised by the large number of severe regional storms with record high thunderstorm losses recorded in the US and in Europe.
Global temperatures set to break record
Weather disasters were exacerbated by extremely high temperatures. Worldwide, average temperatures for the year up to November were roughly 1.3°C above those in pre-industrial times (1850–1900). The El Niño phenomenon, a natural climate oscillation in the North Pacific with effects on extreme weather in many regions of the world, played a role in the temperatures. However, researchers attribute the trend towards warmer global temperatures mainly to climate change, with natural fluctuations playing a subordinate role.
Munich Re’s Chief Climate Scientist, Ernst Raunch, commented: “The warming of the earth that has been accelerating for some years is intensifying the extreme weather in many regions, leading to increasing loss potentials. Society and industry need to adapt to the changing risks – otherwise loss burdens will inevitably increase. Analysing risks and the changes to them is hardwired into Munich Re’s DNA. That is what enables us to consistently offer insurance covers against natural disasters – and even to expand them. This allows us to cushion a portion of the losses and alleviate some of the hardship caused.”
The year's most costly events
After years of calm, the series of devastating earthquakes in southeast Turkey and Syria led the number of deaths caused by natural disasters to rise to 74,000 in 2023, well above the 10,000 annual average of the last five years. According to Munich Re, the earthquakes in Turkey and Syria marked the year’s most destructive natural disasters. Some 58,000 people were killed, countless buildings collapsed, and there was significant damage to infrastructure. With overall losses of around $50 billion, it is also thought by Munich Re to have been the year’s most costly natural disaster.
The second most costly natural disaster was Typhoon Doksuri. In July, the storm brushed the coastline of the Philippines before making landfall at Jinjang in Fujian province on the Chinese mainland, with wind speeds of around 180km/h. Overall losses came to around $25 billion, of which roughly only $2 billion was insured, exemplifying the large insurance gap for natural disasters that persists in China.
The rapid intensification of Hurricane Otis on the west coast of Mexico in October was another exceptional event, developing from a weak tropical storm into a highest-category hurricane in 24 hours. With wind speeds of up to 265km/h, it has been recorded as the most severe storm to ever hit Mexico’s Pacific coast.
Doksuri and Otis fall into the pattern scientists expect because of climate change, namely a shift towards an increased number of intense storms and extreme rainfall. Experts also attribute the more frequently observed rapid intensification of tropical storms to climate change.