Cats In '99 Burden Industry

According to Swiss Re's sigma study, 52,000 people were killed by catastrophes in 1999, with natural catastrophes being responsible for more than 80 percent of all victims. Nearly 25,000 victims lost their lives as a result of earthquake, and more than 16,000 as a result of storms.

A large part of the economic losses, which according to Swiss Re totalled more than US$65 billion, also is attributable to natural catastrophes. A series of catastrophes in August and September made a major contribution to economic losses. These include the earthquakes in Turkey and Taiwan, with total damage of about $20 billion and $14 billion, respectively; Hurricane Floyd at $7 billion; and Typhoon Bart in excess of $3 billion.

The year had a large impact on insurers operating in the regions affected by earthquakes and storms, as well as on international industrial insurers and reinsurers. According to initial sigma statistics, the losses of more than $22 billion registered in 1999 made it the most expensive year since 1994 and the fourth most expensive in the history of insurance.

Damage from earthquakes, storms and man-made disasters – such as major fires or aviation accidents – reached record figures in 1999. The only reason that the loss figures of 1989, 1992 and 1994 were not equalled was because the level of insurance in Turkey and Taiwan was modest. The trend towards high losses from natural catastrophes and man-made disasters seems to be continuing unabated.

Six Billion-Dollar Losses
Almost half of the insurance industry's claims originated from six billion-dollar loss events. Typhoon Bart caused insured losses in Japan of approximately $2.5 billion, and, in the Bahamas and on the southeast coast of the US, Hurricane Floyd was responsible for around $2.2 billion in damage.

The earthquake in western Turkey in mid-August caused insured losses of approximately $2 billion, while a series of more than 70 tornadoes in the Mid-West resulted in losses of around $1.5 billion. The earthquake in Taiwan and the hailstorm in Sydney each registered insured losses of approximately $1 billion.

Of the insured losses resulting from man-made disasters totalling more than $4 billion, more than half were attributable to major fires and explosions. Particularly expensive events in the US were the explosions in a power station ($650 million), an aluminium plant ($275 million) and an oil refinery ($247 million). Aviation and space insurers, for their part, wrote losses in excess of $1.5 billion.