2026 Global Modeled Catastrophe Losses Reach $171B

October 14, 2026 / 3 min read

Originally published by The Insurer during the 2026 Rendez-Vous de Septembre in Monte Carlo.

Sustainable growth can be hardest for insurers and reinsurers in a softening market, when competitive pressure on pricing clashes with sound underwriting. Now is such a time, with rates at their lowest levels in four years, and this is one instance where catastrophe models are critical. Modeled losses continue to increase, a cautionary signal for the market that gives underwriters support to make prudent, confident decisions.

ships-at-harbor

Verisk’s 2026 Global Modeled Catastrophe Losses Report updates this trajectory, putting the global modeled insured average annual loss (AAL) at $171 billion — a 13% ($19 billion) increase over the prior year. Actual insured losses averaged $139 billion over the past five years versus $129 billion in the preceding five.

Frequency perils such as severe thunderstorms, winter storms, wildfires, and inland floods now drive more than half ($96 billion) of the modeled AAL. Insured losses exceeded $100 billion for the sixth consecutive year in 2025, led by the January Los Angeles wildfires at an estimated $40 billion insured loss, the largest on record for a wildfire event.

Deceptively calm

And yet the market is priced for calm: rate-on-line fell 16% at mid-year 2026 on record capital of roughly $790 billion, as underwriting relaxed and terms loosened. Meanwhile, first-half 2026 actual catastrophe losses ran below the ten-year average after a year in which no hurricane made landfall in the continental United States. Such conditions point to more of the same for the market. This is precisely the environment in which a modeled, clear, near-present climate view of the tail helps underwriters keep pricing anchored to the underlying risk.

That view suggests it’s only a matter of time before the industry sustains a $200 billion insured loss year. And it reminds us why catastrophe modeling matters. A 100,000-year catalog of possible scenarios puts a single “down” year into perspective. Verisk’s suite of global natural catastrophe models covers more than 120 countries and regions, built on a scientific framework of possibilities and probabilities to cut through the noise of short-term trends. Since the first Global Modeled Catastrophe Losses Report was published in 2012, the estimated AAL has grown from $59 billion (in 2012 dollars) to $171 billion as model coverage has expanded and become more sophisticated.

Key loss drivers

Verisk is committed to presenting a view of risk that is realistic and transparent. Verisk’s report examines four contributing factors to the modeled losses:

A near-present climate marked by warming seas and shifting large-scale climate patterns, with losses rising most sharply in the tail
Demand surge over the course of settling claims after catastrophe events, which raises material and labor costs and adds to those losses
Precise vulnerability modeling, based on property-level characteristics, that drives the tail of the loss distribution beyond what regional averages can capture
Steady exposure growth since 2021, which increases losses independent of catastrophe activity

The same Verisk models and software that market participants license are the foundation of every year’s Global Modeled Catastrophe Losses Report — reproducible in clients’ own environments with no conversion or adaptation. We encourage decision-makers to test, challenge, and use this baseline to reduce volatility in an uncertain future of risk.

Explore the insights driving losses, and keep your pricing anchored to the risk beneath the calm.

Download the report

Global Modeled Losses: A Clear Benchmark in a Shifting Risk Transfer Market

Deceptively calm

Key loss drivers