2003 a “modest” year for cat losses: Swiss Re

A new Swiss Re sigma study shows 2003 should be a relatively modest year for cat losses, with insurers paying out about US$17 billion (Cdn$22.5 billion) globally.The preliminary estimates put total financial losses from cats at US$65 billion (Cdn$86 billion), with about 20,000 lives lost.There were five cats costing insurers more than US$1 billion last year, all in North America April ice storms in the U.S.; tornadoes and hailstorms hitting the U.S. Midwest in May; Hurricane Isabel in September; and the two California forest fires in late October-early May. Of the US$17 billion price tag facing insurers for 2003, the bulk, US$15 billion comes from natural disasters. Of the man-made disasters, the majority were industrial fires, explosions, aviation and space losses. Although there were terrorist attacks, the impact was less in insurance terms than in the loss of life, with 15 attacks claiming 475 lives.Although 2003 will be classified as “moderate”, it does follow the trend of increasing costs due to catastrophes, which have cost billions of dollars virtually every year since the last 1980s. “The 2003 figures confirm this trend towards high losses, which is being driven in part by increasingly densely populated areas, higher concentrations of insured values and the development of endangered zones.”