Natural Disasters Drive up Global Reinsurance Rates in 2024


  • Reinsurance companies that cover insurance providers establish premium prices yearly influencing the following year’s insurance costs.
  • In 2023, natural disasters such as earthquakes in Turkey and Syria, as well as wildfires in Hawaii, contributed to insured losses approximating to $100 billion, a slight decrease from 2022, but still significantly above average, according to Swiss Re.
  • Following these natural disasters, reinsurance rates for U.S. property catastrophe rose by up to 50% on January 1, 2024, and saw a 100% increase in Turkey, according to Gallagher Re.
  • Yet, reinsurance costs remain unaltered for clients unaffected by natural disasters in the preceding year.
  • Reinsurance broker, Guy Carpenter (Marsh McLennan division) states that global property catastrophe reinsurance rates spiked by up to 30% at the beginning of the year for policies already affected by losses.
  • Current geopolitics in Gaza and Ukraine have prompted reinsurers to focus on war, political violence, and terrorism insurance policies, reports Gallagher Re.
  • Aviation reinsurance premiums have escalated by a maximum of 25%, while marine market war risk premiums for ships entering the Red Sea surged ten times upon the Israel-Hamas clash commencement.

The Impact of Reinsurance and Natural Disasters

Reinsurance organizations, which furnish insurance for insurance providers, set the insurance cost trend for each upcoming year based on the prices agreed at the start of each year. In 2023, seismic events in Turkey and Syria, wildfires in Hawaii, and additional natural disasters culminated in insured losses worth nearly $100 billion. This was a decrease from 2022 but significantly above the norm according to estimates from Swiss Re.

Reinsurance Rates Skyrocket

Following these natural calamities, reinsurance rates for U.S. property catastrophes rose by as much as 50% for policies previously affected by these disasters come January 1, 2024. In Turkey, such rates have doubled according to Gallagher Re. However, some clients who were not subjected to calamities last year experienced no change in their reinsurance rates.

As per a report by reinsurance broker Guy Carpenter, which operates under Marsh McLennan, global rates for property catastrophe reinsurance ascended by as much as 30% for policies previously beleaguered by losses as of January 1.

Geopolitical Conflicts Shape Reinsurance Rates

The ongoing conflicts within Gaza and Ukraine have drawn the attention of reinsurers towards policies covering war, political violence, and terrorism, as per the report from Gallagher Re. Consequently, reinsurance rates in aviation saw an upswing by 25%. In the marine market, the ongoing Israel-Hamas conflict caused Red Sea entrance premiums for war risks on ships to increase tenfold.

This rise in reinsurance rates can have significant implications on the forex and trading industry. Changes in these rates can influence risk management strategies and potentially affect the trading of assets within the insurance sector.

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