5
As the graphic in Figure 1.1 from Swiss Re for 2014 indicates, although the protection gap may be widest in the developing world, its financial impacts are more substantial in the world’s economic powerhouses. For example, in absolute terms the US, Japan and China account for the biggest share of the global property protection gap, with expected annual uninsured losses of more than USD 81 billion, which is
more than two thirds of the total gap of USD 120 billion for the sample countries. 3 While developed nations might be better prepared for the rise in extreme weather events, such as tropical cyclones, IMF data shows that they are just as likely to be affected. This makes adequate risk management crucial globally to build resilience and avoid significant negative impact on the global economy.
Figure 1.2 - Rising danger
Tropical cyclone - historical and projected monthly probability of occurrence 4
2010-2014 2050 2100
0.061 0.051 0.043
0.060 0.052 0.042
0.058 0.050 0.038
Advanced economies
Emerging markets
Low-income developing countries
2 Geneva Association, harnessing technology to narrow the insurance protection gap, source of stats: Swiss Re 3 http://institute.swissre.com/research/library/052015_Underinsurance_of_property_risks_closing_the_gap.html 4 International Disaster Database, IMF.
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