Billion-dollar disasters: The economic toll of wildfires, severe storms and earthquakes is soaring
NBC5 days
These staggering losses highlight the urgent need for better disaster preparedness and climate adaptation. The record-breaking wildfire, and a state law that forces private insurers to keep rates artificially low, which leaves homeowners without coverage and public options potentially insolvent. Insurance cannot bail us out of the climate crisis without real action taken to fight it.
While losses appear alarming, they actually decreased from $155 billion in the first half of 2024 to $131 billion in 2025. The insurance industry has successfully adapted to cover 61% of total losses, providing crucial financial protection. Modern risk assessment and pricing mechanisms help distribute costs effectively across the global market.
There is a 50% chance that the total damage incurred by climate change in the 21st century will be 16.5% of the world gross domestic product, according to the Metaculus prediction community.