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Rising Catastrophe Losses Widen Global Protection Gap: Swiss Re Report

Swiss Re’s 2024 report on natural catastrophe trends highlights a worsening global protection gap, with USD 137 billion in insured losses and total economic losses reaching USD 318 billion—of which 57% were uninsured, leaving a USD 181 billion shortfall. For 2025, insured losses are projected to climb to USD 145 billion, nearly 6% higher than in 2024, positioning it as one of the costliest years on record. Key events like the Los Angeles wildfires alone may account for USD 40 billion in insured damages.

The report attributes the rising losses to climate change, urban sprawl, population growth, and underinsurance. Over the last 30 years, insured losses have grown 5.9% annually, far outpacing global GDP growth of 2.7%. Secondary perils, particularly severe convective storms, are now the second-largest cause of losses after tropical cyclones.

Swiss Re urges the insurance industry to expand capacity, refine risk assessment tools, and invest in climate adaptation measures. The growing protection gap underscores the need for more inclusive insurance coverage and enhanced global resilience strategies to cope with intensifying disaster risks.