Natural disasters are ranked as the leading cause of corporate insurance losses in the United States and account for almost a quarter of claims in the last five years, says Allianz Global Corporate & Specialty SE in a report released on Tuesday.
Globally, natural disasters ended up in second place after fires / explosions, accounting for 15% of losses and $ 13.9 billion in claims between 2017 and 2022, according to the report.
The claim rate has increased, and inflation will push costs higher, the report said.
Hurricanes / tornadoes are the most costly cause of natural disasters, accounting for 29% of the value of all claims, driven by two of the most active Atlantic hurricane seasons ever, 2017 and 2021, according to the report.
Other main causes were storm (19%), flood (14%), frost / ice / snow (9%) and earthquake / tsunami (6%).
Insurance companies have also seen new and more unusual loss scenarios, the AGCS said in the report.
In 2021, the great freeze and floods in Texas in Germany stood out as major events with unexpected claims, the report said.
The freeze in Texas caused huge disruptions in infrastructure and manufacturing, with many companies being forced to suspend due to extensive power outages, resulting in some major losses from conditional business outages.
Financial losses from the incident are estimated at $ 150 billion, while the winter storm Uri caused $ 15 billion in insured losses nationwide.
There has been a change in the natural disaster activity, says Frank Sapio, senior vice president, regional claims manager, AGCS North America.
Increased activity in forest fires and droughts in the western United States, severe convective storms in the Midwest and significant hurricane seasons have occurred in recent years, Sapio said.
“The winter storm in Texas was an odd loss in the form of a giant freeze that cut off the power and caused huge losses in the United States and around the world due to temporary business interruptions,” he said.
The number of contingent claims on business interruptions has increased annually over the past five years, which highlights the growing interdependence and complexity of business supply chains, the report states.
Insurance companies paid out approximately $ 89.9 billion in corporate insurance claims globally and approximately $ 33.7 billion in the United States between 2017 and 2022.
The results of the report were based on an analysis of more than 530,000 insurance cases in 207 countries and territories in which AGCS was involved during the five-year period.