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Third-costliest year on record for weather disasters in 2021: $343 billion in damages

Posted on 7 February 2022 by Guest Author

This is a re-post from Yale Climate Connections by Jeff Masters

Earth was besieged by a remarkable 47 billion-dollar weather disasters in 2021, and the total damage wrought by weather disasters was $329 billion, making 2021 the third-costliest year on record (adjusted for inflation) for weather-related disasters, said insurance broker Aon in its annual report issued January 25.

The only costlier years for weather-related disasters were 2017 ($519 billion) and 2005 ($351 billion), according to Aon. Munich RE has 2021 tied with 2005 and 2011 as the second-costliest year on record for insured losses from natural disasters, with only 2017 being more expensive.

The 47 billion-dollar weather disasters of 2021 were tied for fifth-most on record; the record is 53, set in 2010. Aon’s annual average of billion-dollar weather disasters since 1990 is 26.

“Extreme weather events, some of which were enhanced by climate change, were particularly notable in the United States,” noted the report, but added, “as climate change influenced hazard behavior grows more volatile and severe, the expansion of population footprints will additionally grow the risk of costlier disasters.” Disaster losses are increasing rapidly due to an increase in wealth and exposure (more people with more stuff living in vulnerable areas), making it difficult to quantify how climate change might be responsible for the concerning rise in disaster costs in recent years.

Global economic lossesFigure 1. Global economic costs from weather-related disasters (adjusted for inflation), 1950-2021. Damages in 2021 were the third-highest on record. (Image credit: Aon 2021 annual report)

A record four mega-disasters costing over $20 billion

For the first time on record, 2021 had four individual weather events topping the $20 billion economic loss threshold: Hurricane Ida, July flooding in Europe, summer seasonal flooding in China, and a February winter weather disaster in the U.S./Mexico. “This was just the second time on record in which four $20+ billion events had been registered in a calendar year,” Aon reported, “but the first time that four events were weather/climate related. In 2004, there were two hurricanes (Charley and Ivan) and two earthquakes (October 23 Japan Earthquake and the December 26 Indian Ocean Earthquake and Tsunami).”

Considering insured losses, 2021 was the most expensive ever for winter weather, at $17 billion, and third-costliest for severe weather (including severe thunderstorms, tornadoes, and hail)—nearly $27 billion. Only 2020 ($38 billion) and 2011 ($33 billion) had higher severe weather insured losses.

Insured damage from wildfires in 2021 was $5 billion, marking the seventh consecutive year that insured wildfire losses surpassed $2 billion. Prior to 2015, the globe recorded just four years in which aggregated wildfire-related insured losses topped $2 billion.

Thankfully, drought losses in 2021 were below the 2000-2020 average, at $21 billion. The pandemic helped push global food prices to their highest levels in 46 years in 2021, and food prices would have been dangerously high if above-average drought losses had hit the major grain-growing breadbaskets of the world.

Total combined economic cost of global droughtFigure 2. Global economic losses from drought (in 2021 USD). Damages in 2021 were below the 2000-2020 average.

Approximately 10,500 people died in natural disasters (including earthquakes) in 2021. That toll is relatively low compared to the historical annual average, continuing a heartening trend that has been observed in recent years. “Improvements in forecasting, evacuation planning/strategies, increased public awareness, and better building practices have all played a key role. Asia, Africa, and South America show the greatest improvements with reduced fatalities,” Aon said.

The deadliest natural disaster in 2021 was an earthquake in Haiti that claimed 2,248 lives. The deadliest weather disaster was monsoon flooding in India, which killed an estimated 1,292 people. The second deadliest was the late June heat wave in western North America, with 1,029 deaths: 800 deaths in western Canada, and 229 in the northwestern U.S.

The most costly disaster in 2021 was Hurricane Ida in the U.S., which caused $75 billion in damage. According to statistics from EM-DAT, the international disaster database, that total ranks as the fifth-most-expensive global weather disaster since accurate records began in 1990. The Aon report noted this ominous fact: “41 percent of tropical cyclone losses in this century occurred within the last five years (2017-2021).”

Global billion-dollar weather disastersFigure 3. Billion-dollar weather disasters 1990 – 2021, as cataloged by Aon. (Image credit: Jeff Masters)

Two nations, Germany and Belgium, have costliest disasters on record

Based on historical disaster costs at EM-DAT, two nations, Germany and Belgium, set all-time records for their most costly weather-related disaster in 2021, from the July mega-flood. According to EM-DAT, the 2021 floods in Germany did $20 billion in damage (previous costliest weather disaster: flooding in August 2002 that cost $18 billion); the 2021 floods in Belgium did $1.7 billion in damage (previous costliest disaster: $760 million 2021 USD from Windstorm Daria in January 1990). EM-DAT did not list damages for Luxembourg and Austria from the July 2021 flood, but Aon’s database listed that flood as the costliest natural disaster on record for insured damages for these nations.

For comparison, one nation had its most expensive weather-related natural disaster in history in the EM-DAT database in 2020, seven did so in 2019, two did so in 2018, three in 2017, four in 2016, and nine in 2015. Note that these tallies will be considerably different using Aon’s disaster figures, which can differ from EM-DAT’s by a factor of two. Aon’s database is generally superior to EM-DAT’s, but is not publicly available in full detail.

U.S. 2021 billion-dollar weather and climate disastersFigure 4. U.S. weather disasters costing at least $1 billion in 2021. (Image credit: NOAA)

Second-highest total of billion-dollar weather disasters for U.S.

In the U.S., there were 23 billion-dollar weather disasters, according to Aon, and 20, according to NOAA. These are the second highest totals on record in both databases, with the record being 27 in Aon’s database and 22 in NOAA’s, both set in 2020. The difference in the 2021 tallies results from Aon’s listing three separate wildfire events that caused more than $1 billion in damage; NOAA lumped all the wildfires together as one billion-dollar event. In addition, Aon listed an October 24-27 flood disaster in California, Oregon, and Washington as a $1.3 billion disaster, and NOAA did not list it as a billion-dollar disaster.

NOAA’s 2021 billion-dollar weather disaster list included one drought event, 11 severe storm events, two floods, four tropical cyclone events, one winter weather event, and one wildfire event. Together, these events killed 688 people and cost $145 billion, the third-highest yearly total on record, behind 2017 and 2005. Billion-dollar events account for 80-85% of the total U.S. losses for all weather-related disasters.

NOAA’s 1980-2021 annual inflation-adjusted average is 7.4 billion-dollar events, but over the past five years (2017-2021), the annual average has more than doubled, to 17.2 events. NOAA stated that the number and cost of disasters are increasing over time as a result of:

– a combination of increased exposure (i.e., values at risk of possible loss);
– vulnerability (i.e., more people living in flood plains, on barrier islands, etc.); and
– climate change’s increasing the frequency of some types of extremes that lead to billion-dollar disasters.

Here are 2021’s 47 billion-dollar weather disasters, as tabulated by Aon:

The Aon report concluded, “Bottom Line: Most of the world’s homes, businesses, and infrastructure were built to meet the needs for a 20th Century climate. As the effects of climate change accelerate, the need to prepare for the more intense events of tomorrow becomes more urgent with each passing day.”

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Comments

Comments 1 to 2:

  1. I alway like to compare apples to apples. 

     

    In this case, the adjusting the data for inflation adjusted values is a good start.  Though, the comparison should also be adjusted for population growth and after inflation adjusted growth in wealth.  

    World population increased from 4.4b in 1980 to 7b in 2020 , US population increased from 227m in 1980 to approx 330m in 2020.

    Per capita net wealth likewise increased (after adjusting for inflation) during that time period .

     

    After making those appropriate adjustments, the increase in disaster costs is much more modest that presented in the article

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  2. David-acct:

    SInce we want to compare apples to apples perhaps we need to consider that modern buildings are built to withstand extreme weather better than older buildings are.  This summer I had to replace my roof here in Florida.  Part of the cost was to compeltely renail the roof to the rafters because code now requires about twice as many nails.  They also use more nails to fasten shingles to the sub roof.  After making those appropriate adjustments, the increase in disaster costs is much greater than that presented in the article.

    Data easily Googled compare the amount of increased damage from geological disasters (like earthquakes and volcanoes) to the amount of increased damage from weather.  These are both affected by population increase and wealth increase.  We find that weather changes cause much more damage than geological changes.  This indicates that AGW is causing much more damage than would be expected if the climate was not changing.  I have not bothered to link the data since you do not provide data links to support your wild claims.

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