Natural disasters like hurricanes, wildfires and floods cost the world $150 billion in 2019.
Losses for business and the economy are also expected to increase because of a decade-long rise in natural catastrophes with direct links to climate change, reports CNN Business.
Munich Re, one of the world's largest reinsurance companies, said on Wednesday that it expects to see an increase in the frequency and intensity of weather-related disasters in certain parts of the world.
Reinsurance companies sell cover to insurers to protect them from very large losses.
"We expect 2020 to be part of this trend towards increasing losses from weather-related disasters, a trend that we have been observing over the last decade," Ernst Rauch, Munich Re's chief climatologist, told CNN Business.
Climate change is contributing to the increase in extreme weather events, said Rauch.
Munich Re, which has been studying climate change since the 1970s, has observed an increase in severe thunderstorms in North America and Europe. The storms are at times accompanied by hail, tornadoes and flooding, and their frequency can most likely only be explained by climate change, Rauch added.
In Australia, a prolonged period of extremely dry and unusually hot weather has added to the severity of bushfires in the country and can likely be attributed to global warming, he said.
"What climate change does is change probabilities, so if we see an increasing probability of large losses from wildfires that indicates that climate change is contributing," added Rauch.
Losses from Australian wildfires have increased over the past four decades, Rauch said.
The Insurance Council of Australia said in a statement Tuesday that insurance losses from bush fires this season stood at $700 million Australian dollars ($481 million).
Insurers have received nearly 9,000 claims since September and "many more" are expected to be lodged in coming days and weeks, the Insurance Council said. At least 26 people have died in the fires, according to Australian police.
There were 820 natural catastrophes in 2019, slightly below the previous year but well above the long-term average of 520, according to Munich Re. In 2018, losses from natural disasters amounted to $186 billion.
Japan's typhoons Hagibis and Faxai together accounted for the largest overall losses ($26 billion) last year, followed by Typhoon Lekima, and floods in India and China.
Natural disasters cost the insurance industry $52 billion in 2019, below the previous year but above the 30-year average. This is partly due to lower cover for flood losses in developed countries, Rauch said.
Disasters such as Mozambique's Cyclone Idai — which caused $2.3 billion in losses and more than 1,000 deaths — were almost completely uninsured, he said.
More people are taking out cover for natural catastrophes in rich countries, but insurance penetration has barely increased in the developing world, Rauch said.
An increase in losses from weather-related disasters will cause premiums to rise and make it more expensive for business and property owners to buy insurance, he said.