US thunderstorms account for 61 percent of H1 2024 global insured losses

First half of 2024 became the second costliest US SCS H1 total on record...

• Intense start to Atlantic hurricane season brings fresh concerns for rest of 2024

An active start for natural catastrophes in the first half of 2024 pushed global insured losses 25% above the H1 decadal average to at least $61 billion, with the vast majority of losses attributed to US severe convective storms (SCS), according to Gallagher Re’s H1 2024 Natural Catastrophe and Climate Report. Total H1 economic losses were estimated at $128 billion – slightly lower than the decadal average of $133 billion. 

Gallagher Re’s H1 analysis summarizes the preliminary global insured and economic loss totals from natural catastrophes; reviews major events including SCS, global flooding, and extreme heat and drought; and provides insight on the impact of record-setting Hurricane Beryl, historical global heat, and the shift to La Niña on the remainder of 2024. 

Highlights of the report include: 

• US SCS continues to drive global losses: Of the estimated $61 billion in H1 global insured losses, US SCS accounted for a minimum $37 billion – or 61% of the total. Gallagher Re estimates the first six months of 2024 became the second costliest US SCS H1 total on record behind 2023’s $47 billion. Even more, when combining US SCS insured losses during the past 18 months (FY 2023 and H1 2024), the total surpasses $100 billion – the costliest two-year stretch ever recorded for the peril. The consequence of this SCS activity has continued to put tremendous strain on primary insurers who are increasingly forced to absorb most, or all, of their claims payouts given the small portion of losses ceded to reinsurance.
• Heightened focus on the Atlantic hurricane season: Beryl became the first Category 5 hurricane ever recorded prior to Aug. 1, which has raised concerns for the remainder of the season, especially since record warmth and the transition to La Niña conditions are the main driving factors in the active hurricane forecast. While a higher number of hurricanes does not guarantee higher insured losses, the insurance industry must be prepared for the possibility of a challenging second half of the year.
• Warmest H1 for the world on record dating to 1850: June marked 13 consecutive months of record global temperatures. The impact of such heat could lead to further melting of ice sheets, increase the intensity of tropical cyclones, and make local heatwaves more frequent and severe.

Gallagher Re Chief Science Officer Steve Bowen said: “There was no shortage of meaningful storylines for natural catastrophes to start 2024, but the record-setting cost of US thunderstorm activity remains an incredibly important story to tell. Surpassing $100 billion in insured losses within an 18-month span confirms that SCS should no longer be treated as a non-peak peril for the industry. This staggering sum gives emphasis to the critical importance of promoting proactive mitigation investment in this increased environment for destructive thunderstorms -- before the next major disaster occurs. 

“As we shift to the rest of the year, the transition to La Niña will not only influence Atlantic hurricanes but also bring more extreme weather volatility to various regions of the world and with it, difficult challenges to many communities around the globe. It’s important to note, the fundamental premise of insurance is to help people in their time of need, and the reinsurance industry is well positioned and capitalized to deliver on that need.”