Global insured losses from floods doubled to $80 billion during 2011 to 2020 as compared to the previous decade, according to a Swiss Re Economic Insights report. In 2021 alone, global flood losses reached $20 billion. These losses can be attributed to a number of factors, including economic growth, larger populations and urbanization, which have increased the level of flood exposure around the world. Climate change has also led to more high-intensity rainfall and flooding events that have even impacted areas outside of typical floodplains.
Despite these figures, insurance penetration remains low, with only 18% of global flood losses between 2011 and 2021 covered by insurance. This may change, however, with improvements in data quality and sophisticated risk mapping and modeling that incorporate detailed hazard, vulnerability and asset value information. This data will enable insurers to more accurately price flood risk and develop the private sector flood market.