2024 Shows Economic Resilience Amid Lower Catastrophe Costs, Predicts Gallagher Re

The Gallagher Re Natural Catastrophe and Climate Report for Q1 2024 indicates a promising start to the year for the insurance industry, with global economic losses from natural disasters at USD 43 billion, 17% below the previous decade’s Q1 average. The United States, facing severe convective storms and other weather-related events, accounted for significant parts of the losses, though overall costs were manageable. The report outlines a shift from El Niño to La Niña conditions, predicting a potentially active Atlantic hurricane season which could impact future insurance claims and industry readiness.

In the United States, insured losses from severe convective storms (SCS) exceeded expectations, reaching USD 11 billion of the total USD 20 billion covered by insurers globally. The early estimates reflect a continuation of the trend seen in 2023, with hail as a primary driver of these losses. The agricultural sector also remains at risk due to weather-related disruptions, which may influence insurance markets and claims as the year progresses.

Internationally, regions like Asia faced significant losses from the Noto Peninsula earthquake in Japan, with estimated economic costs reaching USD 12 billion. Europe and other areas saw fewer catastrophic events, resulting in below-average losses. The insurance market is poised to handle an active hurricane season, backed by ample reinsurance market capital and a watchful eye on the transitioning ENSO conditions.