- Insurance covered 9% of economic losses in the region
- Floods across Asia were the biggest contributor to disaster-related deaths
- Record flash flood losses in China in 2021
SINGAPORE – Media OutReach – March 23, 2022 – Aon plc (NYSE: AON), a leading global professional services firm, has released its 2021 Weather, Climate and Catastrophe Insight report, which assesses the increasing frequency and severity of disruptive natural disasters and how the economic losses that resulting are protected worldwide. This data serves as the foundation for information that can help business leaders quantify and qualify disaster risk and assess how their organizations can increase their resilience in an increasingly unstable climate.
The report reveals a total of $343 billion in economic losses worldwide in 2021, including $329 billion resulting from weather and climate events, making last year the third costliest year on record after adjusting for the ‘inflation. While losses increased compared to 2020 globally, the number of notable catastrophic events decreased slightly, demonstrating the increased cost and severity of these events.
For Asia, after three consecutive years (2018-2020) of economic losses exceeding $100 billion, the toll fell to $72 billion in 2021. Of the losses in 2021, insurance only covered 9% of losses, compared to 38% of losses covered worldwide. .
“There is clearly a gap in both climate risk protection and innovation,” said Owen Belman, head of Asia at Aon. “As catastrophic events increase in severity, how we ultimately assess and prepare for these risks cannot depend on historical data alone. We must look to artificial intelligence and predictive models that are constantly learning and evolving to map the volatility of a changing climate and its interaction with a complex and ever-changing urban environment With scalable solutions, organizations can make better decisions that make them more resilient as they continue to face interconnected and increasingly volatile risks.
Major discoveries in Asia include:
- About 10,500 people lost their lives due to global natural disasters in 2021; 46% of deaths occurred in Asia.
- Floods across Asia were the main driver of disaster-related deaths during the year, further accentuated by the trend towards urbanization, leading to higher population density.
- Flash flooding in Henan in July led to $18.6 billion in economic loss and a record $1.9 billion in covered losses, the costliest weather event for China’s insurance industry
- Super Typhoon Rai was the deadliest tropical cyclone of the year. Its arrival at the end of December left 409 dead in the Philippines and one in Vietnam. Rai has become the third costliest typhoon ever recorded in the Philippines.
- Seasonal flooding in India has claimed 1,282 lives.
- Asia’s costliest tropical cyclone was Indian Cyclone Yaas, with nearly $3 billion in economic losses.
- Malaysia experienced its costliest and widest flood event on record in December, with total economic losses exceeding $2 billion.
- In Japan, the most damaging disasters have been attributed to seismic hazard. The combined economic loss amounted to almost $9 billion, mainly due to the events in Fukushima (February) and Miyagi (March).
- Taiwan set a new national temperature record – 40.6°C (105.1°F) – on August 11.
“Many Asian communities are exposed to increasingly unstable weather patterns that are in part enhanced by the growing effects of climate change,” said Brad Weir, Asia Analytics Manager for Reinsurance Solutions at Aon. “This includes record rainfall and flooding, intense tropical cyclones, droughts and winter storms. With one of the lowest levels of insurance coverage and rapidly changing urbanized centers, addressing vulnerabilities related to Climate risk is not only essential, but also presents many challenges. We can no longer build or plan to respond to yesterday’s climate. With the rising costs of physical damage losses, this also leads to persistent global disruptions. supply chains and various humanitarian and other asset-related services and private entities to collaborate and help bridge the gap in insurance protection The way forward for organizations and governments must include efforts of sustainability and mitigation to navigate and minimize risk as new forms of related volatility to emerging disasters.
The full report and a short video are available on Aon’s interactive microsite. Along with this report, readers can access current and historical natural disaster data and event analysis at catastropheinsight.aon.com.
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