Climate change presses on: Devastating wildfires and intense thunderstorms exacerbate losses for insurers

Natural disasters caused significant losses worldwide in 2025. All in all, damage amounting to some US$ 224bn was incurred, of which insurers covered around US$ 108bn. This means that 2025 joins a growing list of years with insured losses exceeding the US$ 100bn mark, despite losses being lower year on year. In 2024, inflation-adjusted overall losses had totalled US$ 368bn, of which US$ 147bn had been insured. Weather disasters accounted for 92% of all 2025 losses and for 97% of insured losses.

Around 17,200 people lost their lives in natural disasters worldwide – significantly more than in the previous year (approximately 11,000), but below the 10-year average of 17,800 and 30-year average of 41,900.

The big picture was alarming with regard to floods, severe convective storms and wildfires in 2025. An increasing long-term impact is attributed to such non-peak perils, which led to total losses of US$ 166bn last year – of which around US$ 98bn was insured. The destruction caused by these perils was greater than the inflation-adjusted averages for the past 10 and 30 years (overall losses: US$ 136bn/US$ 90bn; insured losses: US$ 60bn/US$ 33bn). Scientists largely agree that such natural disasters are becoming more severe and more frequent in many parts of the world.

In view of these extreme losses, the world was clearly spared potentially far worse losses by chance alone in 2025. This applies particularly to no hurricane striking the US mainland, though severe storms did occur there. All in all, worldwide losses from natural disasters in 2025 came in below the inflation-adjusted averages for the past 10 years (US$ 266bn). Insured losses mirrored the 10-year inflation-adjusted average of US$ 107bn. Overall losses and insured losses alike in 2025 substantially exceeded the 30-year inflation-adjusted averages.

At around 50% of total losses, uninsured losses were lower than the 10-year average of around 60% due to the high percentage of insured losses attributable to the Los Angeles wildfires. Disregarding this loss event, the insurance gap matched the 10-year average.