Economic losses from hurricanes and other natural disasters rose in the U.S. last year and were above average globally, reflecting another year of costly severe storms, floods and droughts.
Damage caused by Hurricanes Helene and Milton helped bring the total economic loss from natural disasters in the U.S. last year to $217.8 billion, according to insurance broker Aon PLC. This figure represents an increase of 85.3% from 2023, when the deficit was approximately $117.5 billion. This is also the largest annual figure of economic loss caused by natural disasters since 2017.
Insured losses, or the share of economic losses that are covered by insurance, also increased last year. They rose 36% to $112.7 billion, the most since 2022. In some areas, homes are at such great risk that they insurance is too expensive – If private insurance is available at all.
Hurricane Helene devastated six southeastern states last fall, causing $75 billion in economic losses, mainly due to inland and coastal flooding. According to Aon. Less than two weeks later, Hurricane Milton made landfall on the west coast of Florida, causing approximately $25 billion in economic losses.
“In 2024, a big difference is that we had significant U.S. hurricane events,” said Liz Henderson, global head of climate risk advisory at Aon. “When those events occur, they affect a large area and they affect areas with large values in terms of properties, people and material. So the damage caused by those events is quite high.”
At least two other hurricanes, several severe “convective” storms and a draft contributed to the damage from natural disasters in the US last year.
In addition to the deadly hurricanes in the US, deadly flooding in Spain's Valencia region and other natural disasters, natural disasters caused economic losses of $368 billion worldwide last year, according to Aon. This is a decline of 7.3% from 2023, but almost 14% more than the annual average dating back to 2000. Meanwhile, global insurance losses rose 15.1% to $145 billion.
Although it is impossible to predict the timing, location and damage caused by natural disasters, the beginning of 2025 is not encouraging. The devastating wildfire that swept through Los Angeles County on January 7 killed at least 28 people and destroyed more than 14,000 structures, already projected to be one of the costliest natural disasters ever.
In a separate report last week, Aon estimated that total economic and insured losses for the two largest wildfires — the Palisades fire and the Eaton fire just outside Los Angeles — could reach tens of billions of dollars, potentially making them the costliest. Will make. Wildfire in American history.
Pacific Palisades, a Los Angeles neighborhood that has been Palisades destroyed by fireThis epitomizes the insurance nightmare facing homeowners living in areas prone to climate disasters.
Pacific Palisades had approximately 1,600 policies. Dropped by State Farm in July, California Department of Insurance spokesman Michael Soller said in an email to CBS MoneyWatch on Jan. 16. One Analysis Insurance data obtained last year by CBS News San Francisco found that State Farm also deleted more than 2,000 policies in two other Los Angeles ZIP codes, including the Brentwood, Calabasas, Hidden Hills and Monte Nido neighborhoods.