Catastrophes cost economy $350bn in 2011

Natural and man-made catastrophes cost the world economy $350 billion (270 billion euros) and 30,000 lives this year, reinsurer Swiss Re said on Thursday. "2011 will be the year with the highest catastrophe-related economic losses in history, at USD 350 billion," the company said in a statement. The figure compares to $226 billion last year. According to preliminary estimates, total insured losses for the global insurance industry from disasters reached $108 billion in 2011 -- more than double the 2010 figure $48 billion and the second highest on record. "2011 would have been the costliest year ever for the insurance industry if Japan had been more fully insured," said Swiss Re, referring to the earthquake which sparked a tsumani and the Fukushima nuclear disaster in March. "On top of people losing their loved ones, societies are faced with enormous financial losses that have to be borne by either corporations, relief organisations or governments and, ultimately, taxpayers," said Kurt Karl, Swiss Re’s chief economist. The Japan quake cost the insurance industry about $35 billion though total losses were nearer $210 billion. Total losses from the New Zealand quake which hit in February stood at $15 billion but most of this was covered by insurers, Swiss Re said. The most expensive year for insurers was 2005, the year when hurricane Katrina hit the United States, which along with other disasters cost the industry $123 billion. On top of the quakes in Japan and New Zealand, severe flooding in Thailand and Australia this year triggered more than $10 billion in insurance claims. Two tornadoes in the US cost almost $14 billion in claims and the industry paid out nearly $5 billion in property damage following Hurricane Irene. The reinsurer said more than 30,000 people lost their lives because of catastrophes in the first eleven months of the year, most of them in Japan. Earthquake insurance is still quite low, even in some industrialised countries with high seismic risk, such as Japan, it said. This year additional claims following the Thailand floods or winter storms which may yet hit Europe could bring it closer to the 2005 record, it said.