- Munich Re’s new "Topics Geo – Natural catastrophes 2006" published
- Board member Dr. Torsten Jeworrek: "Strict risk management equips us to deal with the increase in weather extremes"
- Climate change signifies both risk and opportunity
Munich Re maintains its assumption that the continuing unfavourable natural climate cycle and additional effects of global warming will increase the risk of hurricanes in the current and forthcoming years, even although there were relatively few major losses caused by tropical cyclones in the North Atlantic during 2006. In its newly published "Topics Geo – Natural catastrophes 2006", the Group’s Geo Risks Research experts come to the conclusion that special meteorological factors such as dust particles from the Sahara and the El Niño climate phenomenon hampered hurricane formation.
Board member Dr. Torsten Jeworrek: "The conclusions of Geo Risks Research are consistently incorporated into our risk models, thus enabling us to pursue a forward-looking underwriting policy. We have no doubt that climate change and growing concentrations of values will boost demand for insurance cover in the long run. Thanks to strict risk management, Munich Re is equipped to deal with the increase in weather extremes. Moreover, as a Group that turns risks into value, we see opportunities and the need for new forms of cover alongside our traditional business competence."
Munich Re has been analysing the consequences of climate change and resultant risks for more than 30 years. Recent publications such as the reports by economist Sir Nicholas Stern and by the Intergovernmental Panel on Climate Change (IPCC) confirm the conclusions of our Geo Risks Research Department. Not least with the signing of the joint statement by the Global Roundtable on Climate Change (GRoCC) chaired by leading economist Jeffrey Sachs (Columbia University, New York), Munich Re affirms its commitment to international agreements on the sustained reduction of greenhouse gas emissions.
Significantly more favourable 2006 loss balance due to reduced hurricane activity
Overall economic losses due to natural catastrophes in 2006 were approximately US$ 50bn (US$ 15bn of which were insured), barely a quarter the figure for 2005, the most expensive natural catastrophe year ever with losses in the region of US$ 219bn. The year’s most devastating natural catastrophe was the earthquake that struck Indonesia close to the city of Yogyakarta on 26 May 2006, in which more than 5,700 people lost their lives. Economic losses of US$ 3.1bn due to the earthquake are in marked contrast with the relatively small insured loss of US$ 35m, accounted for by the low insurance penetration.
A complete chapter of the publication is devoted to an analysis of the 6.3 magnitude (severe) Yogyakarta earthquake because of its unusual features. It was noticeable that damage to many of the more modern buildings was greater than expected with an earthquake of this force. Thus the data provided by the earthquake on the vulnerability of buildings in Indonesia and comparable countries in Southeast Asia give cause for concern. The findings have been incorporated in a new earthquake risk model for the region. Board member Dr. Torsten Jeworrek: "At the same time, we will be supporting loss-prevention measures in the region. The growing population figures of the major cities in Southeast Asia, with their high exposure to natural hazards, make swift action imperative."
Further features: Snow pressure, cyclones in Australia, typhoons in the Pacific, tsunami
Munich Re’s new publication also analyses the snow pressure losses of the 2005/2006 winter and draws conclusions about Cyclone Larry, the most severe tropical cyclone ever to hit the Australian coast. Other articles feature the typhoon season in the Pacific, the Java tsunami, and climate observations for 2006. "Topics Geo – Natural catastrophes 2006" can be downloaded from Munich Re’s website (www.munichre.com) or ordered in print version. pportunities and risks) and cycle management.
signed Dr. Jeworrek signed Dr. Lawrence
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