A trend analysis of normalized insured damage from natural disasters

Fabian Barthel and Eric Neumayer

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: As the world becomes wealthier over time, inflation-adjusted insured damages from natural disasters go up as well. This article analyzes whether there is still a significant upward trend once insured natural disaster loss has been normalized. By scaling up loss from past disasters, normalization adjusts for the fact that a disaster of equal strength will typically cause more damage nowadays than in past years because of wealth accumulation over time. A trend analysis of normalized insured damage from natural disasters is not only of interest to the insurance industry, but can potentially be useful for attempts at detecting whether there has been an increase in the frequency and/or intensity of natural hazards, whether caused by natural climate variability or anthropogenic climate change. We analyze trends at the global level over the period 1990 to 2008, over the period 1980 to 2008 for Germany and 1973 to 2008 for the United States. We find no significant trends at the global level, but we detect statistically significant upward trends in normalized insured losses from all nongeophysical disasters as well as from certain specific disaster types in the United States and Germany.

JEL-codes: G22 Q54 (search for similar items in EconPapers)
Pages: 42 pages
Date: 2010-11
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Citations: View citations in EconPapers (3)

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Related works:
Journal Article: A trend analysis of normalized insured damage from natural disasters (2012)
Working Paper: A trend analysis of normalized insured damage from natural disasters (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:37600

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