The rise of natural catastrophe insured losses in non-peak zones is evident when looking at the global distribution of losses over the last three years. Figure 1 shows 35 percent of insured losses between 2009 and 2011 were located in Asia while only 33 percent were in the United States. Australia and New Zealand also saw a marked increase in insured natural catastrophe losses during this period, with 19 percent of the total.
This is in stark contrast to the global distribution of natural catastrophe insured losses between 2002 and 2008 (see Figure 2). During this period, more than three-quarters of all insured losses occurred in the United States whereas Asia only accounted for 9 percent.
The traditional dominance of the U.S. market is illustrated when analyzing the top twenty insured natural catastrophe losses over the last 40 years (see Table 1). More than half of all the events between 1970 and 2011 affected the United States. This meant the U.S. market, and losses from U.S. hurricanes in particular, largely determined the availability of catastrophe reinsurance cover and the direction of rates.
The global nature of natural catastrophe losses in 2011 broke this historical trend. Indeed, the 2011 earthquakes in Japan and New Zealand and the floods in Thailand are all among the top ten most costly insured events in the last 40 years. This contributed to a 9.5 percent average increase in global property catastrophe rates at January 1, 2012, according to the Guy Carpenter Global Property Catastrophe Rate on Line Index.