In 2024, the economic losses due to natural disasters worldwide amounted to about *** billion U.S. dollars. Natural disasters occur as a result of natural processes on Earth. Many different types of natural disasters can occur, including floods, hurricanes, earthquakes, and tsunamis. Natural disasters in 2024 Tropical cyclones generated the highest amount of economic losses in 2024 with *** billion U.S. dollars worldwide. Hurricanes Helene and Milton were the most destructive events worldwide that year with over 100 billion U.S. dollars in economic losses. Flooding events ranked second in the costliest events in 2024, with flooding in Valencia, Spain, and South and Central China being the worst examples. Asia hardest hit by natural disasters A highly destructive force, Asia is one of the most susceptible regions to natural disasters. The repercussions of natural disasters are not only physical, but also economic. Costs may be high – depending on the severity – as areas affected by natural disasters might need to be rebuilt. Lower income countries are more likely to be affected by natural disasters for a multitude of reasons, including a lack of developed infrastructure, inadequate housing, and lack of back-resources.

In 2023, there was a global protection gap of *** U.S. dollars for natural disasters worldwide. The estimated economic loss of natural disasters worldwide was *** billion U.S. dollars, while the estimated insured loss amounted to *** billion U.S. dollars.Where did the most costly natural disaster occur?Natural disasters are extreme, sudden catastrophes that are caused by natural processes by the earth. Different types of natural disasters include floods, hurricanes, tornadoes, earthquakes, and tsunamis. There are many consequences that occur as a result of natural disasters, which include death, economic and infrastructural damage, and public health issues. The 2011 earthquake and tsunami that happened in Japan caused the most economic damage worldwide in the past four decades. Most costly disasters for insurersThe impact of natural disasters on insurance companies varies depends on the prevalence of insurance coverage in the affected region. Generally, losses from natural disasters that occur in wealthy countries such as the United States include a greater percentage of insured losses than disasters that occur in lower income countries. 2017 remains the worst year for insured property losses in the United States due to several major hurricanes in the U.S. and the Caribbean. Domestically, Hurricane Katrina was the most expensive natural disaster of all time.

The hurricanes in the U.S. and Mexico in September and October incurred an economic loss of about 110 billion U.S. dollars, the most of any natural disaster event in 2024. Three of the ten most expensive catastrophes in that year were hurricanes. Weather, climate, water related disaster The disasters that caused mortality in large numbers include droughts, storms, floods, and extreme temperatures. Hurricanes alone generated 35 percent of the total economic losses among the leading disasters over these 50 years. The global cost of natural disaster losses was primarily financial losses. Low-income countries are more affected by natural disasters when compared to the richer countries in the world. American Hurricanes Floods were the most common weather-related disasters recorded, yet storms had the highest human and economic losses. As the most common cause of damage, storms are the only disaster for which the attribution component grows. As of 2023, Hurricane Katrina was by far the most destructive hurricane in the United States. Officials confirmed more than 1,800 deaths, estimated damages of about 200 billion U.S. dollars, the destruction of approximately 350,000 homes, and displaced almost a million individuals.

In 2024, the direct economic loss that resulted from natural disasters in China was about *** billion yuan. That year, around ***** million hectares of agricultural land were affected by natural disasters in China.

In 2024, tropical cyclones caused the most damage in the United States. Such a type of storm, for instance, resulted in overall losses of 121.6 billion U.S. dollars. Meanwhile, wildfires, droughts, and heatwaves resulted in economic losses of $ 10.5 billion U.S. dollars. Severe convective storms were the second most destructive natural disaster that year, with a loss of almost 68.6 billion U.S. dollars. Impact of severe thunderstorms in the U.S. Severe thunderstorms pose a great risk to public safety and often result in fatalities. People can be harmed in many ways during a thunderstorm, such as being directly struck by lightning or hurt when a building collapses/tree falls. In 2019, 70 people were killed as a result of severe thunderstorms. Lightning strikes alone caused 20 deaths and 100 injuries in that year. How much was paid out due to thunderstorms? The high risk of damage posed by thunderstorms means that insurance cover is an important tool in reducing the losses incurred. In 2020 alone, approximately 71,500 homeowner insurance claims were paid due to lightning losses.

Weather catastrophes caused economic losses of 329 billion U.S. dollars worldwide in 2021. Sudden cataclysmic disasters cause devastation on impact. Some weather and climate-related extreme events are storms, floods, heat waves, cold waves, droughts, and forest fires. Climate-related hazards pose risks to human health and can lead to substantial economic losses. Global natural disaster economic loss The economic damage caused by disasters varies based on geography and affects natural resources. Capital assets and infrastructure, along with the loss of life, disrupt the economic structure. In 2021, the economic loss due to natural disasters globally was about 343 billion U.S. dollars, and flooding generated the highest loss that year. Billion-dollar natural disaster events in the United States The United States experienced nearly two dozen billion-dollar disasters in 2021. At an economic loss of around 75 billion U.S. dollars, Hurricane Ida, a Category 4 storm that landed on the Louisiana coast in August, was the costliest.

This report analyses the economic losses (financial) of damage caused by natural disasters in the United Kingdom. There is no complete database with regards to total financial loss due to natural disasters (e.g. the total value of insurance claims related to damage caused by a natural disaster in the United Kingdom, the estimated cost of replacing and repairing levelled or damaged buildings and infrastructure, the estimated impact on business activity and value output). However, IBISWorld has collated and analysed related information and data provided by a number of sources – these include, albeit not limited to: the Centre for Research on the Epidemiology of Disasters (CRED); the Organisation for Economic Co-operation and Development (OECD); PreventionWeb; the UN Office for Disaster Risk Reduction (UNDRR); the Cabinet Office; the European Commission; the European Environment Agency (EEA); and the Inter-Agency Standing Committee Reference Group on Risk, Early Warning and Preparedness.

The earthquake and subsequent tsunami in Japan in 2011 was the costliest natural disaster since 1900, with losses reaching 235 billion U.S. dollars. The tsunami hit the nuclear plant at Fukushima, causing a nuclear disaster in the area. Hurricane Katrina, which hit the Gulf Coast of the United States in 2005, and Hurricane Harvey, which hit the North American country in 2017, tied with the second-largest economic losses in the period, each with 125 billion U.S. dollars.

Of the total economic losses as a result of natural disasters worldwide in 2024, 77.1 percent came from losses in the Americas. This is despite the fact that only 7.3 percent of the people affected by natural disasters that year were living in the continent. Asia followed in second, with 13.3 percent of economic losses.

Economic damage from natural hazards can sometimes be prevented and always mitigated. However, private individuals tend to underinvest in such measures due to problems of collective action, information asymmetry and myopic behavior. Governments, which can in principle correct these market failures, themselves face incentives to underinvest in costly disaster prevention policies and damage mitigation regulations. Yet, disaster damage varies greatly across countries. We argue that rational actors will invest more in trying to prevent and mitigate damage the larger a country’s propensity to experience frequent and strong natural hazards. Accordingly, economic loss from an actually occurring disaster will be smaller the larger a country’s disaster propensity – holding everything else equal, such as hazard magnitude, the country’s total wealth and per capita income. At the same time, damage is not entirely preventable and smaller losses tend to be random. Disaster propensity will therefore have a larger marginal effect on larger predicted damages than on smaller ones. We employ quantile regression analysis in a global sample to test these predictions, focusing on the three disaster types causing the vast majority of damage worldwide: earthquakes, floods and tropical cyclones.

"Disaster data for countries along the belt and road, mainly from the global disaster database.The records information of disaster database are from the United Nations, government and non-governmental organizations, research institutions and the media. It's documented in detail such as the country where the disaster occurred, the type of disaster, the date of the disaster, the number of deaths and the estimated economic losses. This study extracts the natural disaster records of the countries along the One Belt And One Road line one by one from the database, and finally forms the disaster database of 9 major disasters of the 65 countries. The natural disaster records collected can be roughly divided into nine categories, including: floods, landslides, extreme temperatures, storms, droughts, forest fires, earthquakes, mass movements and volcanic activities. From 1900 to 2018, a total of 5,479 disaster records were recorded in countries along the One Belt And One Road. From 2000 to 2015, there were 2,673 disaster records. On this basis, the natural disasters of the countries along the belt and road are investigated from four aspects, including disaster frequency, death toll, disaster-affected population and economic loss assessment. Overall, since 1900, a total of 5479 natural disasters have occurred in countries along the One Belt And One Road, resulting in about 19 million deaths and economic losses of about 950 billion us dollars. Among them, the most frequent occurrence is flood and storm; the biggest economic losses are floods and earthquakes; the most affected people are flood and drought; drought and flooding are the leading causes of death

The costliest natural catastrophe in the United States since records began has been Hurricane Katrina in 2005. Katrina cost the U.S. almost $ 105 billion. From the top ten costliest natural disasters, nine have been hurricanes.

Natural Disaster Insurance Market Outlook

The global natural disaster insurance market size was valued at approximately USD 90 billion in 2023 and is projected to reach USD 145 billion by 2032, growing at a CAGR of 5.5% over the forecast period. This growth trajectory underscores the increasing awareness and need for financial protection against the catastrophic losses caused by natural disasters. As climate change intensifies the frequency and severity of such events, the demand for insurance solutions that can mitigate economic risks is rising. This burgeoning market is bolstered by advancements in technology, government policies promoting insurance uptake, and a growing recognition of the importance of risk management strategies among businesses and individuals alike.

One of the primary growth drivers of the natural disaster insurance market is the escalating incidence and severity of natural calamities. Climate change has undeniably increased the frequency of disasters such as hurricanes, floods, wildfires, and earthquakes, leading to unprecedented economic damages. These events have heightened awareness among individuals and organizations about the catastrophic financial impacts of such occurrences, driving the demand for comprehensive insurance coverages. Moreover, the integration of advanced predictive analytics and risk assessment technologies is enabling insurers to offer more tailored and accurate insurance products. This technological evolution not only increases the efficiency of insurance underwriting but also enhances customer satisfaction by providing more personalized solutions.

Government initiatives and policies also play a crucial role in the expansion of the natural disaster insurance market. Many governments worldwide are implementing mandatory insurance policies and providing subsidies to encourage the uptake of disaster insurance. Such initiatives are pivotal in markets where insurance penetration is traditionally low, ensuring that even vulnerable populations have access to financial protection. Additionally, collaborations between public and private sectors are fostering innovative insurance products that are more accessible and affordable, further fueling market growth. In regions prone to specific disasters, governments are also partnering with international organizations to develop risk pooling mechanisms, which help distribute risk and make insurance more viable.

The growing participation of the private sector in offering disaster insurance coverages is another significant factor contributing to market growth. There is an increasing trend among businesses to include disaster risk management as a core component of their strategic plans. Corporations are investing in insurance products to safeguard their assets against potential losses due to natural catastrophes, ensuring business continuity. Insurers, in response, are developing innovative products that cater specifically to the unique needs of various industries, enhancing their market share. This trend is particularly prevalent in sectors such as agriculture, real estate, and infrastructure, which are highly susceptible to natural disasters.

Regionally, North America is expected to lead the natural disaster insurance market due to its high insurance penetration and frequent exposure to natural calamities. The Asia Pacific region is also anticipated to witness substantial growth, driven by rapid urbanization, economic development, and increased vulnerability to extreme weather events. Europe follows closely, benefitting from stringent regulations mandating disaster insurance coverage. Conversely, the Middle East & Africa and Latin America, while experiencing slower growth rates, are gradually increasing their market presence through governmental reforms and international partnerships aimed at enhancing insurance accessibility.

Coverage Type Analysis

Within the natural disaster insurance market, coverage types play a pivotal role in defining the range and scope of protection offered to policyholders. Property insurance remains one of the most sought-after coverage types, primarily because of its direct correlation with asset protection. As real estate and infrastructure investments grow, so too does the need for robust property insurance solutions that can safeguard these investments against natural calamities. This segment is witnessing significant innovations, with insurers offering comprehensive packages that cover a wide array of risks, from floods and earthquakes to hurricanes and wildfires. Insurers are leveraging data analytics and geographic information systems (GIS) to assess risk levels accurately, thus enhancing

In 2024, there were roughly 18,100 reported fatalities caused by natural disaster events worldwide. This was well below the 21st-century average and significantly lower than the fatalities recorded in 2023, which were driven by the earthquakes that hit Turkey and Syria on February and became the deadliest catastrophes in 2023, with nearly ****** reported deaths. Economic losses due to natural disasters The economic losses due to natural disaster events worldwide amounted to about *** billion U.S. dollars in 2024. Although figures in recent years have remained mostly stable, 2011 remains the costliest year to date. Among the different types of natural disaster events, tropical cyclones caused the largest economic losses across the globe in 2024. What does a natural disaster cost? Hurricane Katrina has been one of the costliest disasters in the world, costing the insurance industry some *** billion U.S. dollars. The resilience of societies against catastrophes have been boosted by insurance industry payouts. Nevertheless, insurance payouts are primarily garnered by industrialized countries. In emerging and developing regions, disaster insurance coverage is still limited, despite the need for improved risk management and resilience as a method to mitigate the impact of disasters and to promote sustainable growth.

Series Name: Direct economic loss in the housing sector attributed to disasters (current United States dollars)Series Code: VC_DSR_HOLNRelease Version: 2020.Q2.G.03 This dataset is the part of the Global SDG Indicator Database compiled through the UN System in preparation for the Secretary-General's annual report on Progress towards the Sustainable Development Goals.Indicator 11.5.2: Direct economic loss in relation to global GDP, damage to critical infrastructure and number of disruptions to basic services, attributed to disastersTarget 11.5: By 2030, significantly reduce the number of deaths and the number of people affected and substantially decrease the direct economic losses relative to global gross domestic product caused by disasters, including water-related disasters, with a focus on protecting the poor and people in vulnerable situationsGoal 11: Make cities and human settlements inclusive, safe, resilient and sustainableFor more information on the compilation methodology of this dataset, see https://unstats.un.org/sdgs/metadata/

Series Name: Direct economic loss attributed to disasters relative to GDP (percent)Series Code: VC_DSR_LSGPRelease Version: 2020.Q2.G.03 This dataset is the part of the Global SDG Indicator Database compiled through the UN System in preparation for the Secretary-General's annual report on Progress towards the Sustainable Development Goals.Indicator 11.5.2: Direct economic loss in relation to global GDP, damage to critical infrastructure and number of disruptions to basic services, attributed to disastersTarget 11.5: By 2030, significantly reduce the number of deaths and the number of people affected and substantially decrease the direct economic losses relative to global gross domestic product caused by disasters, including water-related disasters, with a focus on protecting the poor and people in vulnerable situationsGoal 11: Make cities and human settlements inclusive, safe, resilient and sustainableFor more information on the compilation methodology of this dataset, see https://unstats.un.org/sdgs/metadata/

About 1.7 thousand natural disasters in Africa have been reported between 1970 and 2019, causing economic losses of around 38.5 billion U.S. dollars. Floods and storms had the highest economic impact. Storms caused 37 percent of the total reported economic losses, while floods were responsible for 34 percent of them. Africa is particularly vulnerable to climate change compared to other regions of the world. A large share of the population lives below the poverty line and its livelihood depends on activities extremely sensitive to climate changes and weather conditions.

Series Name: Direct agriculture loss attributed to disasters (current United States dollars)Series Code: VC_DSR_AGLHRelease Version: 2021.Q2.G.03 This dataset is part of the Global SDG Indicator Database compiled through the UN System in preparation for the Secretary-General's annual report on Progress towards the Sustainable Development Goals.Indicator 11.5.2: Direct economic loss in relation to global GDP, damage to critical infrastructure and number of disruptions to basic services, attributed to disastersTarget 11.5: By 2030, significantly reduce the number of deaths and the number of people affected and substantially decrease the direct economic losses relative to global gross domestic product caused by disasters, including water-related disasters, with a focus on protecting the poor and people in vulnerable situationsGoal 11: Make cities and human settlements inclusive, safe, resilient and sustainableFor more information on the compilation methodology of this dataset, see https://unstats.un.org/sdgs/metadata/

In 2024, the United States experienced 29 natural disasters, which made it the most natural catastrophe-prone country in the world that year. Indonesia and China came second on that list, with 20 and 18 natural disasters occurring in the same year, respectively. Storms were the most common type of natural disaster in 2024. Types of natural disasters There are many different types of natural disasters that occur worldwide, including earthquakes, droughts, storms, floods, volcanic activity, extreme temperatures, landslides, and wildfires. Overall, there were 398 natural disasters registered all over the world in 2023. Costs of natural disasters Due to their destructive nature, natural disasters take a severe toll on populations and countries. Tropical cyclones have the biggest economic impact in the countries that they occur. In 2024, tropical cyclones caused damage estimated at more than 145 billion U.S. dollars. Meanwhile, the number of deaths due to natural disasters neared 18,100 that year. The Heat Wave in Saudi Arabia had the highest death toll, with 1,301 fatalities. Scientists predict that some natural disasters such as storms, floods, landslides, and wildfires will be more frequent and more intense in the future, creating both human and financial losses.

Disaster Risk Transfer for Municipalities Market Outlook

According to our latest research, the global Disaster Risk Transfer for Municipalities market size reached USD 5.7 billion in 2024, reflecting a robust response to escalating climate risks and urban exposure. The market is projected to grow at a CAGR of 12.2% from 2025 to 2033, reaching a forecasted value of USD 16.0 billion by 2033. This surge is primarily driven by the increasing frequency and severity of natural disasters, compelling municipalities to seek advanced financial mechanisms for risk mitigation and resilience.

The primary growth driver for the Disaster Risk Transfer for Municipalities market is the rising incidence of catastrophic events such as floods, earthquakes, hurricanes, and wildfires. These disasters have not only increased in frequency but have also grown in intensity, causing substantial economic damage to municipal infrastructure and public services. As urban centers expand and population densities rise, the financial exposure of municipalities to disaster-related losses intensifies. This scenario has heightened the urgency for municipalities to adopt sophisticated risk transfer solutions, including insurance, reinsurance, catastrophe bonds, and risk pools, to safeguard their fiscal health and ensure rapid recovery post-disaster. The integration of advanced analytics and modeling tools has further enabled municipalities to quantify risks more accurately and negotiate better terms with risk transfer providers.

Another significant factor fueling the market's expansion is the evolving regulatory landscape and the increasing involvement of international development agencies. Governments and supranational organizations are actively promoting disaster risk transfer mechanisms as part of broader climate adaptation and resilience strategies. Financial incentives, technical assistance, and capacity-building initiatives are being extended to municipalities, particularly in emerging economies, to facilitate the adoption of innovative risk transfer instruments. These efforts are complemented by the growing participation of private sector players and capital markets, which have introduced new products such as catastrophe bonds and parametric insurance, thus broadening the market's reach and sophistication.

Technological advancements and the proliferation of digital platforms have also played a pivotal role in accelerating market growth. The emergence of online platforms and digital brokers has streamlined access to disaster risk transfer products, enabling municipalities to compare offerings, assess coverage options, and execute transactions with greater efficiency. Moreover, the integration of big data, artificial intelligence, and geospatial analytics has enhanced risk assessment capabilities, allowing for more precise pricing and customization of solutions. This digital transformation is reducing barriers to entry, fostering competition among providers, and ultimately driving down costs for municipalities seeking comprehensive risk transfer strategies.

From a regional perspective, the Disaster Risk Transfer for Municipalities market exhibits diverse growth patterns, with North America and Europe leading in terms of adoption and market share. These regions benefit from mature insurance and reinsurance markets, robust regulatory frameworks, and high levels of municipal awareness regarding disaster risk management. In contrast, Asia Pacific and Latin America are experiencing rapid growth, propelled by rising urbanization, increasing disaster exposure, and supportive government policies. The Middle East & Africa region, while still nascent, is witnessing growing interest in risk transfer solutions as part of broader climate resilience initiatives. Overall, regional dynamics are shaped by the interplay of economic development, regulatory support, and the evolving risk landscape.

Solution Type Analysis

The Solution Type segment in the Disaster Risk Transfer for Municipalities market encompasses a comprehensive range of financial instruments designed to mitigate the fiscal impact of catastrophic events. Insurance remains the most widely adopted solution, offering municipalities direct indemnity against losses arising from natural disasters. Traditional property and casualty insurance policies are being supplemented with specialized disaster coverage, tailored to address the unique risk profiles of urban and ru