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The Actuary The magazine of the Institute & Faculty of Actuaries
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Disastrous 2004

Swiss Re’s sigma statistics (at www.swissre.com) for 2004 identify around 330 natural and man-made catastrophes worldwide, in which more than 300,000 people lost their lives. By far the largest number of victims was claimed by the tsunami in the Indian Ocean: the authorities in the 12 coastal states affected reported 280,000 people dead or missing.

The sigma study just published puts the total losses directly attributable to these natural and man-made catastrophes at $123bn – of this figure, $49bn was covered by property insurance. For property insurers, 2004 was a record year in terms of claims, mainly due to windstorms: hurricanes in the US and neighbouring countries cost insurers around $32bn, typhoons in Japan and neighbouring countries a further $6bn.

These record figures were the result of both the unusually high number of storms – 13 hurricanes in the US and 10 typhoons in Japan – and the increasing concentration of insured assets in highly exposed coastal regions. Climatologists attribute the high windstorm frequency to above-average sea-surface temperatures and the high year-round average temperatures measured in the last decade. 2004 was the fourth-warmest year since regular temperature measurements started in 1861.