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The Swiss Re Institute\u2019s latest sigma report, which analyses natural catastrophe losses in North America in 2025, suggests that secondary perils now dominate the region\u2019s catastrophe loss landscape.<\/p>\nWith Swiss Re Institute analysis highlighting that ~99.9% of insured natural catastrophe losses in North America in 2025 were driven by secondary perils such as wildfires and severe convective storms (SCS), Monica Ningen, CEO of Property & Casualty Reinsurance US at Swiss Re, has said the year is \u201canother clear signal\u201d that the risk landscape is shifting in ways that neither the industry nor communities across the country can afford to treat as episodic.<\/p>\n
The Swiss Re Institute\u2019s latest sigma report, which analyses natural catastrophe losses in North America in 2025, suggests that secondary perils now dominate the region\u2019s catastrophe loss landscape.<\/p>\n
According to the firm, this means that even in a year without a major US hurricane landfall, insured losses remained elevated, pointing to a structurally higher baseline driven by more frequent high-impact events.<\/p>\n
The sigma report found that total insured losses surpassed $90 billion in 2025, below recent years but still reflecting a rising underlying risk trend.<\/p>\n
According to data, wildfires alone caused a record \u00a240 billion in insured losses, while SCS generated \u00a246 billion, making 2025 the third-costliest year on record for this peril.<\/p>\n
\u201cTogether, these two perils produced the highest annual aggregate insured losses ever recorded from secondary perils in the region,\u201d Swiss Re\u2019s report observed.<\/p>\n
The firm continued, \u201cThe overall insured share of losses was unusually high at 71%, reflecting the composition of events, with wildfire and SCS typically having high insurance penetration in the US.<\/p>\n
\u201cIn North America, wildfire losses are rising much faster than economic growth, with exposures increasingly growing in high-risk areas and underlying risk factors also trending upward.\u201d<\/p>\n
Ningen added, \u201cWhat stands out is not just the $90 billion in insured losses across North America, but the fact that secondary perils like wildfire and severe convective storms are now driving the overwhelming majority of that impact. These are no longer \u2018secondary\u2019 in any practical sense.\u201d<\/p>\n
\u201cWhat is driving this trend is a combination of exposure growth and underlying risk changes. We are seeing more assets concentrated in high-risk areas, particularly in the wildland-urban interface, alongside shifts in weather patterns that increase the frequency and severity of events.<\/p>\n
\u201cThe result is a higher baseline level of loss, even in years that may not look extreme at first glance. That requires a mindset shift. These are not isolated shocks, but now part of the expected loss environment.\u201d<\/p>\n
Ningen concluded, \u201cFor insurers, this reinforces the need to be thoughtful about where and how they take risk. It starts with understanding accumulation, but it also means putting real weight behind mitigation efforts. The encouraging part is that adaptation works.<\/p>\n
\u201cWhen resilience measures are clear and consistently applied, whether through stronger building standards or better land-use decisions, you can see the impact in loss costs over time. The reality is this only works if everyone plays a role.<\/p>\n
\u201cHomeowners, businesses, insurers, and governments all have a part to play in making communities more resilient, and progress depends on those efforts being aligned.\u201d<\/p>\n
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