Los Angeles: Natural disasters caused an estimated $ 224 billion in damage worldwide in 2025, with barely $ 108 billion insured, according to global reinsurance giant Munich Re.
The year’s single most expensive catastrophe was the Los Angeles wildfire disaster, which killed 30 people and caused USD 53 billion in damage, of which USD 40 billion was insured, underlining how wealthy, high-insurance regions dominate global loss statistics.
The second costliest event, Myanmar’s 7.7-magnitude earthquake in March, inflicted around USD 12 billion in damage, but left a far deeper scar on human life, killing more than 4,500 people and injuring thousands.
Behind these headline numbers lies a much larger and largely invisible crisis. While insured losses to homes, factories and infrastructure are meticulously tracked, the wider costs, lost livelihoods, damaged ecosystems, long-term health impacts and stalled development, remain mostly uncounted, shaping how well or poorly societies recover long after the emergency phase is over.
Wildfires, now among the world’s most economically destructive hazards, illustrate this gap most starkly.
According to the 2025 Global Assessment Report on Disaster Risk Reduction (GAR 2025), wildfires caused an estimated USD 106 billion in economic losses and USD 74 billion in insured losses globally between 2014 and 2023, a dramatic jump from the previous decade.
The United States dominates these figures, with nine of the ten most expensive wildfire events since 1970 occurring there, even before accounting for the devastating January 2025 California fires. Yet the global fire footprint tells a different story.
In 2025 alone, nearly 390 million hectares, an area almost the size of the European Union, were burned by wildfires worldwide.
More than half of that area, around 246 million hectares, was in Africa, where most losses are uninsured and where fires destroy subsistence farms, grazing lands, biodiversity and cultural heritage that rarely feature in economic statistics.
Australia, now under a state of emergency in Victoria due to extreme fire danger, stands out as a country where losses are closely documented.
Using Munich Re data, the Insurance Council of Australia has found that Australia has ranked second only to the United States for per-capita extreme-weather financial losses over much of the past 45 years a reflection not just of climate exposure, but of the value of assets at risk.
The imbalance is stark: global disaster costs appear highest where assets are expensive and insured, not necessarily where human and environmental suffering is greatest.
As climate change intensifies fires, floods and earthquakes, experts warn that relying solely on insured losses risks leaving the most vulnerable communities, and the true scale of global disaster damage, dangerously out of sight.
