Noto quake industry loss estimated $1.9bn, Italian storms revised up to $4.8bn: Cresta

The CRESTA organisation, that tracks insurance industry losses outside the United States, has provided its first estimate of insurance market losses for the January 1st M7.5 earthquake that hit near the Noto Peninsula in Ishikawa prefecture, Japan, pegging the total at US $1.9 billion.

It’s far lower than many of the modelled industry loss estimates that came out in the wake of the earthquake.

CRESTA notes that the earthquake in Japan was the only new international (ex-US) catastrophe loss estimated to have caused a greater than US $1 billion insurance industry loss in the first-quarter of 2024, its reporting threshold.

As we reported recently, insurance claims paid for the Noto Peninsula earthquake had reached almost US $415 million, according to recent data from the General Insurance Association of Japan.

However, the organisation also noted some relatively significant upward revisions in events from 2023.

The most stark of which is for the severe convective storms that affected Northern Italy in July 2023, known as the Caronte storms.

These storms caused significant impacts, with damaging hail and winds affecting the regions of Lombardy, Veneto, Friuli-Venezia-Giulia, Piemonte and Emilia-Romagna.

The latest insured loss estimate for these Italian storms is US 4.8 billion, CRESTA said, up from US $2.7 billion in its previous release.

Two more severe convective storm events in Europe, storms Lambert-Kay in June 2023 and Denis in August 2023, have also seen their insurance industry loss estimates revised upwards to now exceed the US $1 billion reporting threshold level for CRESTA. These events predominantly impacted Germany, Switzerland and Austria.

Matthias Saenger, Manager at CRESTA CLIX, said, “Our most recent update shows a benign first quarter with only the Noto earthquake exceeding our capturing trigger of USD 1bn. However, there were significant upward revisions to some of the insured loss figures for events occurring in 2023.

“Event loss figures for large and unprecedented events in particular, such as the Kahramanmaras earthquake in Turkey and the Caronte hailstorms in Italy, have the potential to increase substantially over a period of time. This demonstrates the importance of regular reviews of industry losses, which is something that CRESTA puts a great amount of effort into.

“Our data also show that severe convective storms are no longer purely an issue of frequency but also of severity, with multi-billion event losses becoming more common. It is time to consider no longer referring to severe convective storms as ‘secondary perils’.”