Property/casualty insurers catastrophe losses in North America for the first-half of this year were down 36 percent to $8.1 billion from 2014’s total of $12.6 billion, making it the lightest catastrophe first half since 2010.
The $8.1 billion in first-half catastrophe losses came from 26 events, with 17 of them in the second-quarter accounting for $5.3 billion of the insured losses, according to Verisk’s Property Claim Services (PCS).
PCS has published its full North American catastrophe summary in Barely a Whisper: PCS Q2 2015 Catastrophe Review.
PCS said the results make this half-year the lightest catastrophe first half since 2010. The ten-year U.S. average fell to $10.4 billion as a result.
However, total catastrophe losses for the first half of 2015 could go higher, with estimates pending for three North American events (two in the United States and one in Canada).
The report basically tracks with one from Munich Re also showing a decline in insured losses from catastrophes globally. The Munich Re global report said total natural catastrophe losses incurred in the first half of 2015 were $35 billion, whereas the average value for the last 30 years is approximately $64 billion, when adjusted for inflation. Insured losses for this year so far have been $12 billion globally, compared with a long-term average of $15 billion, Munich Re said.
Also, in the latest report from Aon Benfield’s Impact Forecasting said global natural disaster losses during the first half of 2015, from both an economic and insured loss perspective, were each below the 10-year (2005-2014) average. Impact Forecasting’s preliminary data points to global economic losses of $46 billion, down 58 percent from the 10-year average of $107 billion, and global insured losses of $15 billion, down 47 percent from the 10-year average of $28 billion.
Travelers, one of the first property/casualty insurers to issue quarterly results, this week reported a 19 percent rise in second quarter profits attributable in part to lower costs for natural disasters. The insurer posted a combined ratio of 90.8, an improvement from a ratio of 95.1 in the 2014’s second quarter. Catastrophe costs were $221 million, compared with $436 million a year earlier.
PCS on U.S.
In the United States, PCS designated 25 catastrophe events in the first half of 2015, representing a 20 percent increase in frequency despite a 36 percent decline in severity. Only one event caused more than $1 billion in insured losses, compared with five in the first half of 2014.
Texas was the state most affected by catastrophes, sustaining slightly more than $2 billion in insured losses. Massachusetts followed at just under $1 billion, largely the result of seven winter storm events that occurred in the first quarter. Oklahoma and Missouri had catastrophe losses of $620 million and $460 million, respectively.
Like Massachusetts, New York remains in the top five for the first half because of first-quarter winter storm activity.
With the Atlantic Basin quiet once again, Florida is not among the top ten.
In all, first-half events affected 27 states in 2015 – up from 24 for the same period a year ago.
For the first half of 2015, PCS declared only one Canadian catastrophe event, which came late in the second quarter, a wind and thunderstorm event that affected Alberta and Saskatchewan, causing insured losses of C$56 million. Last year, two events in Canada caused insured losses of C$140 million. One affected Ontario, and the other Manitoba and Saskatchewan.
“We’ve been closely watching the trend toward smaller, more frequent catastrophes,” said Joe Louwagie, assistant vice president, PCS. “For claims departments across North America, this may have implications for catastrophe response planning, and the claims community should remain vigilant: Hurricanes Katrina, Rita, and Wilma followed the quietest first half in the past ten years.”