Global insured losses from natural catastrophes totalled an estimated $42 billion in the first half of 2026, the lowest first-half figure since 2020 and 16% below the 2016 to 2025 average, Swiss Re Institute said on 11 August 2026. Severe convective storms, which bring hail, tornadoes and damaging winds, remained the largest driver, with insured losses of about $28 billion, though that was below the long-term trend.
Economic losses from natural catastrophes were about $100 billion in the half, of which insurance covered around 42%, above the 30-year average of 33%. Swiss Re attributed the higher coverage ratio to the concentration of damage in highly insured markets and widely covered perils.
Why losses were lower
Severe convective storm activity across the United States was above average, but relatively few of the highest-impact storms hit Texas, the Southern Plains and the Southeast, where frequent storms and high concentrations of insured property usually generate the largest losses. Swiss Re said the pattern shows how insured losses depend on where events strike as well as how severe they are.
In comparison, insured natural catastrophe losses in the first half of 2025 were $91 billion in 2026 prices, driven largely by the Los Angeles wildfires.
Europe's wildfire risk
Swiss Re highlighted the risk of an active European wildfire season after June's record heat and persistent dry conditions. Major fires affected France and Spain in July. According to the institute, Europe, the fastest-warming continent, now experiences 64% more hot days, defined as days reaching 30°C or more, than in the 1950s. Insured wildfire losses in Europe have increased by an estimated 8% to 11% a year in real terms since 1970, it said, making wildfire the fastest-growing weather peril globally, although it still accounts for a relatively small share of European insured losses.
"A less costly first half of the year does not mean the risk has gone away. One major hurricane, earthquake or wildfire can quickly change the picture," said Balz Grollimund, head of catastrophe perils at Swiss Re.
Venezuela earthquake
An earthquake sequence in Venezuela caused an estimated $20 billion in economic losses. Swiss Re said no reliable insured loss estimate was yet available, but low insurance penetration means only a small share is likely to be insured. The case illustrates the protection gap in emerging markets, where most disaster losses are uninsured and recovery costs fall largely on households, businesses and governments.
The second half
Historically, the second half of the year accounts for an average of 58% of global insured natural catastrophe losses, driven mainly by North Atlantic hurricanes. Swiss Re noted that El Niño, which is developing strongly in 2026, tends to suppress Atlantic hurricane activity, but does not eliminate landfall risk: 22% of US hurricane landfalls since 1950 occurred during El Niño conditions. El Niño may also affect tropical cyclone activity in the central and eastern Pacific and the risk of floods, wildfires and other extremes elsewhere.
In its sigma report earlier in the year, Swiss Re projected 2026 insured losses of $148 billion under trend conditions.
Implications for energy assets
Catastrophe losses and insurance pricing feed into the cost of owning and financing energy infrastructure. Solar farms in hail-prone regions of the United States have faced rising premiums and tighter terms after large hail losses. Utilities in wildfire-prone areas face high liability insurance costs. Offshore oil and gas facilities and refineries on the Gulf Coast are exposed to hurricane risk, and LNG export terminals in Louisiana and Texas carry significant property insurance.
In Europe, wildfire risk is growing in regions where it was historically lower, which affects transmission lines, substations and renewable energy installations in rural areas. Grid operators in southern Europe have increased vegetation management and fire monitoring along power lines, and some now de-energise lines during extreme fire weather.
The protection gap and climate finance
The gap between economic and insured losses is largest in lower-income countries. In Pakistan, the 2022 floods caused damages and losses estimated at more than $30 billion, very little of which was insured. Climate finance discussions, including those around the Fund for responding to Loss and Damage, increasingly focus on pre-arranged financing such as insurance, catastrophe bonds and contingent credit to reduce reliance on post-disaster appeals.
Market conditions
Lower catastrophe losses in the first half support reinsurer and insurer results, and Swiss Re published its own half-year results in the same period. Catastrophe experience in each half feeds into pricing negotiations at the main reinsurance renewal dates, the largest of which is on 1 January. The second half of the year, with hurricane season, will weigh more heavily on those negotiations than the first.
Long-term drivers
Swiss Re said the long-term drivers of catastrophe losses remain unchanged, including growing exposure in hazard-prone areas and rising reconstruction costs. More homes, businesses and infrastructure are being built in places exposed to floods, storms and wildfires, and the cost of rebuilding has risen with construction inflation. Climate change affects the frequency and intensity of some hazards, particularly heat, heavy rainfall and conditions that favour wildfires. The institute said strengthening resilience and reducing underlying risk will be increasingly important for keeping insurance available and affordable.
For energy infrastructure, those drivers translate into higher design standards and more spending on hardening. Utilities are raising substations above flood levels, replacing wooden poles with steel or concrete in storm-prone areas and installing sensors and cameras to detect fires early. Renewable developers are choosing hail-resistant panels and stowing trackers at steep angles when storms approach. Each measure adds cost, and regulators must decide how much of it customers should bear.
Heat and electricity demand
The record European heat that raised wildfire risk also pushed up electricity demand and power prices in June and July, and reduced output at some river-cooled nuclear plants in France. Heat is not counted as an insured catastrophe in the same way as storms or floods, but it has large economic effects through energy costs, health impacts and lost productivity.
What to watch
Key items include the Atlantic and Pacific hurricane seasons, the European wildfire season into September, the strength of El Niño and its effects on rainfall and storm patterns, and how reinsurance pricing develops ahead of the January renewals.