Dec 16 (Reuters) – Annual global insured losses from natural catastrophes are expected to hit $107 billion in 2025, driven by the Los Angeles wildfires and severe convective storms in parts of the United States, a Swiss Re Institute study showed on Tuesday.
The U.S. stood as the most affected market in 2025, accounting for 83% of the global insured losses.
Insured losses from natural catastrophes topped $100 billion in 2025 for the sixth straight year, according to the report, shifting focus back on tighter underwriting, higher premiums and fresh scrutiny of risk models.
“Reinsurers and the broader insurance sector have a dual role: acting as financial shock absorbers and supporting the development of resilient, risk-informed public policy and private investment that reduce future losses,” said Jérôme Jean Haegeli, Swiss Re’s Group Chief Economist.
However, the figure was below Swiss Re’s earlier forecast of $150 billion in total insured losses. Global insured losses from natural catastrophes had reached $80 billion in the first half of 2025, according to a preliminary report issued earlier this year.
MOUNTING CATASTROPHE LOSSES IN THE U.S.
The Palisades Fire, which tore through Southern California in early 2025 and burned more than 23,000 acres, destroying homes and businesses and forcing thousands to flee, was the costliest wildfire event on record globally with insured losses of $40 billion, Swiss Re said.
Rising climate risks are prompting insurers to pull back from high‑risk areas across the U.S., widening coverage gaps and increasing financial pressure on vulnerable communities.
“2025 once again reminds us that elevated natural catastrophe losses are no longer outliers but the new baseline. It’s critical we double down on investing in resilience and adaptation so communities can be better prepared for the future,” said Monica Ningen, CEO of U.S. Property and Casualty at Swiss Re.
Global insured losses from severe convective storms rose to $50 billion in 2025, making it the third‑costliest year after 2023 and 2024, and extending a multi‑year upward trend.
However, hurricane losses were low, as none of the storms made landfall on the U.S. coast, for the first time in 10 years, despite an active season, helping keep insured losses below Swiss Re’s pre‑season expectations.
(Reporting by Pritam Biswas in Bengaluru; Editing by Shinjini Ganguli)
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