SINGAPORE, 29 July 2025 — Natural catastrophes continue to put a strain on global insurance markets, according to the latest Natural Catastrophe Review published today by Willis, a WTW business (NASDAQ: WTW), a leading global advisory, broking, and solutions company.
Worldwide, insured losses from natural catastrophes now consistently exceed US$100 billion per year. It’s been six years since the insurance industry last experienced a year with low losses from natural catastrophes. Events so far in 2025 indicate that losses exceeding US$100 billion will very likely continue for at least one more year.
Dr Christopher Au, Head of APAC Climate Risk Centre at Willis said: “2024 continued a six consecutive years trend of natural catastrophe losses in excess of US$100 billion. The wildfires in Los Angeles early in 2025 will drive estimated losses of US$40 billion alone so the trend looks set to continue. With global efforts likely failing to keep the temperature below 2°C above pre-industrial levels, our focus must now turn to adapting and building resilience in the face of this new reality.”
Key trends include:
- Exceptional natural catastrophes: So far, major events in 2025 include the Los Angeles wildfires (globally, the worst wildfire event ever with respect to insured losses), the worst wildfires in Japan and South Korea in at least a generation, the third-most active year on record for tornadoes in the United States, the first landfalling cyclone near Brisbane, Australia in 50 years, and the highest wind speed ever recorded over Ireland.
- Natural catastrophes under climate change: The severity and scale of recent catastrophes underlines the need to confront a new era of climate extremes. Risk managers must reassess the risk, integrate climate forecasts into their plans, and ensure insurance and risk frameworks are optimised for today’s evolving threats. Data-driven strategies are needed to narrow protection gaps and stay resilient in a rapidly changing world.
- Leveraging scientific advances to mitigate future risks: The Review presents a forward view on natural catastrophe risk for the remainder of 2025 and early 2026. It also provides concrete advice on how to make the most of seasonal weather forecasts and identifies geographic regions that may be exposed to elevated catastrophe risk during the next three to six months.
Dr Au added, “The wildfire outbreaks in Japan and South Korea this year mark a turning point for how we understand climate risk in Southeast and East Asia. Historically, wildfires in this region were rare and localised, but climate change is reshaping that narrative. Longer, hotter fire seasons, erratic rainfall, and expanding development into forested areas are creating new fire-prone zones where exposure and vulnerability intersect in unprecedented ways.
“We are now seeing growing demand for site-level wildfire assessments that go beyond historical averages. Businesses are recognising that risk must be managed where it manifests, at the site where terrain, fuel types, and emergency response capacity determine outcomes. Tools like fire weather indices and radiant heat modelling, adapted for local conditions, are becoming essential to help estimate potential fire intensity and exposure.
“Companies can respond with tailored risk mitigation and adaptation strategies, with insurance solutions such as parametric products helping address this changing risk profile. By combining granular data, local expertise and innovative risk transfer mechanisms, we can help businesses build resilience against the rising threat of wildfires in Asia.”
The Willis Natural Catastrophe Review is a biannual publication that provides insights into recent natural catastrophes and shares expert views on the risks posed by major perils. It sets out the causes and effects of major catastrophes in 2025 to date and goes beyond the headlines to identify the underlying factors that made them possible. The Review also provides an expert outlook for the rest of the year and into 2026, exploring potential threats from hurricanes, drought, flood and other hazards.
Publish your content with EB Publishing
It's about who you reach. Get your news, events, jobs and thought leadership seen by those who matter to you.
