Fewer Disasters In 97 But More
On The Way--Insurer
By Andrew Marshall
FRANKFURT, Germany (Reuters) - The world suffered an unusually low number of natural disasters in 1997 but faces a sharply rising risk in the future from global warming and weather disruptions, the largest reinsurer said Monday.
The good news in Munich Re's annual review of global disasters was that 1997 saw only 530 ``large loss events,'' well below the usual tally of 580 to 600.
The bad news was that the long-term trend in catastrophes remains on the dramatic increase and disasters will become more frequent and more costly.
Global warming, attributed to increased greenhouse gas emissions, and weather disturbances will pose an ever greater threat, according to Munich Re.
Most of the damage in 1997 was done by windstorms and floods. It was a relatively quiet year for earthquakes, volcanic eruptions, forest fires, droughts, landslides and avalanches. Munich Re said economic losses from such disasters came to $30 billion in 1997, half the previous year's total. But the human toll was more severe -- about 13,000 people killed compared to 12,000 in 1996.
The international insurance industry paid out around $4.5 billion as a result of natural disasters, compared with about $9 billion the previous year.
Windstorms were the most common disaster -- Munich Re counted 170. Floods came second at 120 and the number of earthquakes and volcanic eruptions was put at 100.
``The fact that extreme atmospheric events accounted for such a large proportion of the losses is further evidence for us of the expected change in the environment and climate in many regions of the world,'' said meteorologist Gerhard Berz, who heads Munich Re's geoscience research group.
``New extreme values for various atmospheric parameters like precipitation and wind velocity will often have catastrophic effects,'' he said in a statement.
Munich Re said 1997's most notable disaster was the flooding that hit central Europe during the summer. Economic losses came to around $5.3 billion, with Poland and the Czech Republic bearing the brunt of the damage.
Another focus of the year was the El Nino weather phenomenon, blamed for fueling forest fires in Indonesia and Australia, flooding in South America and Somalia and a number of hurricanes in Mexico.
``The recurrent and long familiar El Nino ... seems to be turning into the 'scapegoat of the year' although, to be fair, it could also have received credit for the extremely low hurricane activity in the North Atlantic and the Caribbean,'' the company said.
Other big disasters included ``mighty earth tremors'' in Italy, a number of earthquakes in Iran which claimed 2,300 lives, and two Far East typhoons that caused windstorms and flood losses from Thailand to Japan.
Munich Re said urgent action was needed to limit man-made changes to the environment.
But it warned that ``even radical environmental protection measures cannot prevent the occurrence of ever more and ever costlier catastrophes worldwide.''
The increasing concentration of people and property in major cities and the greater susceptibility of modern industrial societies to disruptions in infrastructure would ensure that a ``dramatic increase'' in the long-term trend of disasters would continue.
``Comparing the figures for the 1960s and the last 10 years, Munich Re has established that the number of major natural catastrophes was three times larger and cost the world's economies, after adjusting for inflation, eight times and the insurance industry 14 times as much,'' the company said. ``A change in this development is not in sight.''

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