The effects of climate change are also taking their toll on the insurance industry. Projections indicate that claims for damages related to natural disasters will exceed US$100,000 million in 2023 for the third consecutive year.

The reinsurer Swiss Re estimates that costs resulting from natural disasters exceeded US$50,000 million in the first half of the year. More than two-thirds of this total corresponds to costs resulting from damage caused by severe storms in the United States. While this reflects the intensity of the weather events in the United States, it also points to an economy with a more deeply ingrained insurance culture. In contrast, the largest natural disaster of the year—the earthquake that struck Turkey and Syria—caused damage estimated at about US$40,000 million, of which only US$5,000 million was insured.

Costs to insurers related to natural disasters totaled US$125,000 million in 2022, compared with an average of US$81,000 million over the past 10 years and US$110,000 million over the past five years.

These increases have not necessarily been bad news for insurers. According to Bloomberg, Swiss Re’s net income in the first half of 2023 rose, thanks to higher demand for insurance and an increase in premium rates.