Aon: Global economic losses from natural disasters reached USD 260 billion in 2025

According to Aon’s 2025 Global Natural Disasters Report, severe storms have become the most costly insurance risks of the 21st century.

In 2025, global economic losses caused by natural disasters amounted to USD 260 billion, while insured losses remained high at USD 127 billion, with the insurance penetration rate reaching a historic peak of 49%. Throughout the year, 49 major disasters each caused economic losses exceeding USD 1 billion, with the most costly events being wildfires and severe convective storms in the United States.

Prepared by Aon, which provides services to clients in more than 120 countries in the fields of Risk Capital and Human Capital based on analytical data, the 2025 Global Natural Disasters Report has been published. According to the findings, severe convective storms have become the most costly insurance risks of the 21st century. Highlighting that these events, which are becoming increasingly widespread and more frequent, are fundamentally reshaping global loss patterns, the report emphasizes the critical importance of physical and financial resilience in helping organizations manage the risks arising from such events and enhance insurability opportunities.

In 2025, although global economic losses caused by natural disasters declined to USD 260 billion—the lowest level since 2015—insured losses remained high at USD 127 billion. In 2025, insurance payouts exceeded the USD 100 billion threshold for the sixth consecutive year. At the same time, global insurance coverage reached its highest level at 49%.

49 natural disasters caused economic losses exceeding USD 1 billion

In 2025, a total of 49 major natural disasters causing economic losses exceeding USD 1 billion were recorded. While this figure was close to the historical average, it remained lower compared to 2024. As usual, the vast majority of weather-related events occurred in the United States, with 27 events, and the risk type causing the highest losses was severe convective storms, accounting for 21 events. Among the largest disasters causing economic losses exceeding USD 10 billion were the Palisades and Eaton wildfires in California, widespread severe convective storms observed across the United States in mid-March, seasonal flooding disasters in China, the earthquake in Myanmar, and Hurricane Melissa affecting the Caribbean. Meanwhile, in the EMEA region, no disaster causing economic losses of this magnitude was recorded for the first time since 2020.

Nearly 2 million people have lost their lives since 2000

Last year, at least 42,000 people lost their lives worldwide due to natural disasters. When the regional distribution is examined, approximately 14,000 disaster-related deaths occurred in Asia, while more than 24,500 took place in Europe. Nearly all of the deaths in Europe were caused by extreme heatwaves. Since 2000, natural disasters have resulted in the deaths of more than 1.9 million people globally. During this period, the deadliest types of disasters have been earthquakes and tsunamis, heatwaves, tropical cyclones, and floods.

Key findings highlighted in the report are as follows:

In 2025, the insurance sector covered nearly half of global economic losses, while the protection gap declined to a historic low of 51%.

In 2025, 49 major events causing economic losses exceeding USD 1 billion were recorded, a figure above the long-term average. Even more striking was the fact that 30 events with insured losses exceeding USD 1 billion far surpassed the historical average of 17.

The Palisades and Eaton wildfires in California were the costliest events of the year, with economic losses of USD 58 billion and insured losses of USD 41 billion. With these figures, the fires became the most expensive wildfires ever recorded globally.

In 2025, 42,000 people lost their lives worldwide due to disasters. Extreme heat continued to be one of the leading causes of disaster-related deaths, claiming more than 25,000 lives globally. The fact that 2025 was the third hottest year on record further exacerbated this situation.
Excluding heatwaves, the deadliest disaster of the year was the earthquake in Myanmar, which claimed 5,456 lives.

“The insurance sector is positioned as a strategic partner capable of offering risk transfer solutions against natural disasters”

Commenting on the findings of the report, Selda Oknas Tanbay, Co-CEO of Aon Türkiye, said: “This year’s report reveals that strong collaboration among organizations, the insurance sector, public institutions, and societies is now inevitable. The insurance sector, in particular, is deploying record levels of capital and positioning itself as a strategic partner that offers organizations innovative alternative risk solutions that enhance resilience against extreme weather events. Today, true resilience against disasters encompasses not only physical strength but also financial strength. As the impact of extreme weather events on people and assets continues to increase, enhancing resilience through foresight- and data-driven decisions, redesigning risk management, and establishing strong partnerships that enable rapid recovery and support long-term strategies are becoming increasingly important each year.”

You can access the full report here.