Climate change and insurance

Records of mean global temperatures go back to 1861, and for the northern hemisphere there are reliable temperature estimates for the last 1,000 years. The records show a distinctive trend. The average temperature on earth is rising — with an increase of 0.7°C since 1900 alone. The ten warmest years ever recorded have all occurred since 1995. 1998 set a new all-time record: the maximum temperature that year was higher than in any other year throughout the past millennium. The next near record followed in 2005.

A temperature increase of 0.7°C may seem moderate. However, between ice ages and warm periods, which alternate due to natural factors, there is only a difference in mean global temperatures of 6-7°C.

The extremely pronounced warming that has been observed particularly in the past three decades cannot be explained simply by natural influences. The scientists of Munich Re's Geo Risks Research Department are therefore certain that this global warming is man-made and that it will have massive repercussions.

A survey of the years 1950-2005 reveals a massive increase in major weather-related natural catastrophes during that time. Between 1994 and 2005 there were almost three times as many weather-related natural catastrophes as in the 1960s.

The trend is even more distinct with regard to losses. Economic losses increased by a factor of 5.3 in the same period, insured losses by a factor of no less than 9.6. The main causes in both cases were floods and windstorms. The majority of fatalities, more than three-quarters, were caused by "wet storms".