CAPE TOWN – In Aon Benfield’s latest Weather, Climate and Catastrophe Insight Report, 2017 was flagged as the costliest year on record for natural disasters. The global economic cost of natural disasters in 2017 clocked in at a staggering $353 billion (R5.1 trillion), while the insured cost was $134bn.
“It would also be remiss to believe that South Africa is not affected by its ample share of natural catastrophes. The Knysna fires in June 2017 racked up R1.95bn in insured losses, while October 2017 storms came in at R2.05bn – some R4bn in a 180-degree flip between fire and flood in just a five-month stretch,” said Pieter Visser, catastrophe analyst at Aon Benfield Analytics.
As cities in South Africa continue to grow, buildings and structures cover the landscape more densely, inevitably equating to a greater accumulation of risk. “The main factor for increased losses is larger more concentrated exposure, which means that if there is a natural disaster, more households, businesses and people are affected than fifty years ago,” said Visser.
Despite the fact, Individuals and businesses are increasingly under-insured for the financial impact of these events, as weather-related property and business interruption insurance claims continue to grow.
Weather events over the last few years have left no disputing that South Africa has seen a marked increase in the frequency and intensity of severe weather conditions with greater accumulation of exposure within cities and suburbs that are more densely populated.