Europe 'worst hit' by property losses last year

The latest study by reinsurance giant Swiss Re revealed that natural and man-made catastrophes cost world economies more than 70 billion US dollars (£34.71 billion) during 2007 and that more than 20,000 people lost their lives.

The report also showed that property insurers were hit with 28 billion US dollars (£13.88 billion) worth of claims, as a result of these events.

The group said although 2007 was not an exceptional year in terms of either fatalities or losses, the statistics confirmed a trend towards an increased number and cost of such disasters. It added that natural catastrophe losses were rising rapidly, especially those relating to storms and flooding.

Author of the report Rudolf Enz said: "Long-term figures indicate a steep upward trend, particularly in flood losses. Since 1970, losses have risen annually by an average of 12%, or 7% when adjusted for inflation.

"This translates into a doubling of the nominal burden in just over six years."

He added that insurers were working to adapt their models to the new data, as most flood models relied heavily on figures from the 1960s to the 1980s, when the level of flooding in Europe was below the norm.

'Unusually hard-hit'

The group's report showed that during 2007 there were 142 natural catastrophes and 193 man-made disasters.

The number of people who lost their lives was highest in Bangladesh, India, China and Pakistan during the year, while Europe suffered the highest level of property losses.

The report said Europe was unusually hard-hit by natural catastrophes during the year, with the winter storm Kyrill causing insured losses of 6.1 billion US dollars (£3.02 billion) across Germany, the UK, Belgium and the Netherlands.

There were also further insured losses of 4.8 billion US dollars (£2.38 billion) in the UK caused by the summer floods. Insurers were hit to the tune of 1.6 billion US dollars (£793.4 million) as a result of storms in the United States in April, while the California forest fires in October led to losses of just over £1 billion US dollars (£495.9 million).

At the same time man-made disasters, such as industrial fires, explosions and aviation disasters, led to 6,900 people losing their lives and insured losses of more than 4 billion US dollars (£1.98 billion) in 2007.