Insured losses top $100b in 2025: Willis

Wildfires in Japan and South Korea this year mark a turning point for climate risk.

Insured losses from natural catastrophes are once again expected to surpass $100b in 2025, marking the seventh consecutive year the global insurance industry has faced such high claims, according to the latest “Natural Catastrophe Review” published by Willis, a WTW business.

The report highlights that natural disasters continue to strain insurance markets worldwide, with 2024 losses already above $100b and early 2025 events pointing to a similar trend. 

The Los Angeles wildfires in early 2025 are estimated to have caused around $40b in insured losses alone.

Willis said the scale and intensity of recent catastrophes suggest climate change is reshaping risk profiles across regions. 

So far this year, major events include the most expensive wildfire in history in Los Angeles, the worst wildfires in Japan and South Korea in a generation, the third-most active tornado year on record in the US, a rare cyclone landfall near Brisbane—the first in 50 years—and record wind speeds over Ireland.

Christopher Au, head of the APAC Climate Risk Centre at Willis, said the region is seeing significant shifts in risk. 

“The wildfire outbreaks in Japan and South Korea this year mark a turning point for how we understand climate risk in Southeast and East Asia,” he said.

“Historically, wildfires in this region were rare and localised, but climate change is reshaping that narrative. Longer, hotter fire seasons, erratic rainfall, and expanding development into forested areas are creating new fire-prone zones where exposure and vulnerability intersect in unprecedented ways,” he added.

The report calls for the use of site-specific risk tools, such as fire weather indices and radiant heat modelling, to assess wildfire threats more accurately. 

It also promotes tailored risk mitigation strategies, including the use of parametric insurance products, to help businesses respond to rising wildfire exposure.