Catastrophes cost economy £232bn in 2011

A YEAR of natural catastrophes and man–made disasters cost the worldwide economy over $370bn (£232bn) in 2011, according to new research from the insurer Swiss Re.

It estimates that insurers will have to cover $116bn of this cost, up from their December forecast of $108bn.

Japan’s earthquake, which caused over 19,000 deaths, accounted for more than half the economic loss and was the most expensive earthquake on record, causing $210bn of damage. However a lack of earthquake insurance protection in the country meant insurers will only bear 17 per cent of total costs. “Had Japan been more fully insured, 2011 would certainly have been the most expensive year ever also in terms of insured losses,” said Lucia Bevere, Swiss Re senior catastrophe data analyst.

Last summer’s Thai floods caused $30bn of damage but mainly in heavily insured industrialised areas. As a result Swiss Re estimates that insurers are responsible for just under half of the total bill.

New Zealanders are well insured against disasters, particularly for residential properties, allowing them to claim back $12bn of the $15bn cost of the Christchurch earthquake.