Losses from natural disasters worldwide have fallen sharply to $224 billion in 2025, reinsurer Munich Re said on Tuesday, but warned of a still “alarming” outlook for extreme weather events likely triggered by climate change.
The number was down nearly 40% from the previous year, in part because no hurricane hit the continental United States for the first time in several years.
However, “the overall picture was alarming for floods, severe storms and forest fires in 2025,” said Munich Re, an insurance provider for the insurance sector based in Germany.
The costliest disaster of the year came in the form of wildfires in Los Angeles in January, with total losses of $53 billion and insured losses of around $40 billion, Munich Re said in its annual disaster report.
It was surprising how many extreme events were likely to be influenced by climate change in 2025 and it was just a fluke that the world was spared potentially larger losses, according to the group.
“The planet is running a fever and as a result we are seeing a series of severe and intense weather events,” said Tobias Grimm, chief climate scientist at Munich Re. AFP.
Last month, Swiss Re, another major player in the reinsurance industry, also reported a sharp decline for 2025, putting total losses at $220 billion.
According to the Munich Re report, insured losses for 2025 amounted to $108 billion, also well below last year.
About 17,200 lives were lost in natural disasters worldwide, up significantly from 11,000 in 2024, but below the 10-year average of 17,800, it said.
Grimm said 2025 will be a “two-faced” year.
“The first half of the year was the most costly loss period the insurance industry has ever experienced,” he said, but the second half saw the lowest losses in a decade.
Forest fires in Los Angeles and earthquake in Myanmar
Now it is the cumulative costs of smaller-scale disasters, such as local floods and wildfires, that are having the greatest impact.
Losses from these events amounted to $166 billion last year, according to Munich Re.
After the Los Angeles wildfires, the costliest disaster of the year was a devastating earthquake that hit Myanmar in March, which was estimated to have caused $12 billion in losses, of which only a small portion was insured.
Tropical cyclones caused losses of around $37 billion.
Jamaica was hit by Hurricane Melissa, one of the strongest hurricanes to ever make landfall, causing losses of around $9.8 billion.
By region, total US losses amounted to $118 billion, of which $88 billion was insured, about the same as a total loss estimate of $115 billion from the US nonprofit Climate Central.
The Asia-Pacific region had losses of around $73 billion, but only $9 billion was insured, according to the report.
Australia had its second most expensive year in terms of overall natural disaster losses since 1980 due to a series of severe storms and floods.
Europe suffered losses of $11 billion. Natural disasters in Africa caused losses worth $3 billion, of which less than a fifth were insured.
The report comes at a time of growing skepticism towards green policies, particularly since the return to power of US President Donald Trump, who derides climate science as a “hoax”.
But Grimm warned that the Earth “continues to warm.”
“More heat means more humidity, heavier rainfall and higher wind speeds; climate change is already contributing to extreme weather,” he said.
