SINGAPORE, July 29, 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 USD 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 USD 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 USD 100 billion. The wildfires in Los Angeles early in 2025 will drive estimated losses of USD 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:
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.
“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.”
Dr Christopher Au | Head of APAC Climate Risk Centre, Willis
“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.
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