Billions lost – flooding revealed as the costliest economic peril of 2021 in global report

Incidences of flooding dominated the headlines in 2021, and as well its physical impacts, a new report has revealed that this weather phenomenon had a huge hit on the global economy.

The 2021 Weather, Climate and Catastrophe Insight from British-American multinational professional services firm Aon – which evaluates the increasing frequency and severity of disruptive natural disasters and how their resulting economic losses are protected globally – revealed that at $105 billion flooding emerged as the biggest extreme weather peril by economic loss last year, with flooding events in Europe and China making up the major portion ($75 billion) of this figure.

Other flooding insights from the report, include the fact that European floods in July 2021 were the costliest disaster on record for the continent at $46 billion.

As a whole weather and climate-related events cost the global economy $329 billion in 2021, the third costliest year on record after adjusting for inflation. And this comes despite further figures from the report showing that the number of notable disaster events recorded in 2021 stood at 406, down from 416 in 2020.

Elsewhere in the report four individual events were revealed to have topped the $20 billion economic loss threshold: Hurricane Ida, July Flooding in Europe (Bernd), Summer Seasonal Flooding in China and the February Polar Vortex in North America (US / Mexico).

Commenting on the report findings, meteorologist and Aon head of Catastrophe Insight said:

"Many global communities are exposed to increasingly volatile weather conditions that are in part enhanced by the growing effects of climate change. This includes record-setting episodes of extreme temperatures, rainfall and flooding, droughts and wildfires, rapidly intensifying tropical cyclones and late season severe convective storms.”

And on the lessons that need to be learned he added:

"We can no longer build or plan to meet the climate of yesterday. With physical damage loss costs rising, this is also leading to lingering global disruptions to supply chains and various humanitarian and other asset-related services. The path forward for organizations and governments must include sustainability and mitigation efforts to navigate and minimize risk as new forms of disaster-related volatility emerge."

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