Insurance
Home›Insurance›Property Insurance›Insurers face $171 billion average catastrophe losses,…
Insurers face $171 billion average catastrophe losses, Verisk study says
Verisk estimates severe convective storms drive 40.0% of global modeled annual insured losses, with US attributed losses totaling $117 billion for the average year.
Insurers should be prepared for average annual insured catastrophe losses of $171.0 billion, with Verisk raising its 2026 benchmark by $19.0 billion from its prior estimate, according to Insurance Business.
The modeled average annual loss is based on simulations across Verisk’s catastrophe models across more than 120 countries and regions, and is intended as a long term tolerance level rather than a forecast for any single year.
Verisk said the six consecutive years above $100.0 billion are occurring even in periods without a major US hurricane landfall, with 2025 losses led by the Eaton and Palisades wildfires and a sustained run of severe thunderstorm events. In its findings, each thunderstorm event averaged $771.0 million in insured losses, while the 10-year average annual insured loss is $134.0 billion and the five-year average is $139.0 billion.
The study also highlights how underwriting assumptions are shifting toward frequency driven perils: severe convective storm accounts for 40.0% of global insured average annual loss, tropical cyclone follows at 27.0%, and severe convective activity pushed US insured losses above $50.0 billion for three straight years. Verisk attributed $117.0 billion, or 68.0%, of the $171.0 billion global total to the United States and identified drivers of the rising average annual loss including climate modeling, demand surge, site specific risk precision, and exposure growth. It estimated global property exposure in modeled countries grew about 7.0% per year from 2021 to 2025, with new construction contributing 2.8%.