Record Catastrophe Losses Continue into 2025 as Wildfires and Storms Surge

Catastrophe losses worldwide are expected to surpass $100 billion for the seventh year in a row, according to the 2025 Willis Natural Catastrophe Review. A significant share of this year’s projected total is tied to the January wildfires in Los Angeles, now considered the most expensive wildfire event in insurance history, with insured losses exceeding $40 billion. This single disaster has reshaped insurers’ expectations and stress-tested catastrophe loss budgets within the first quarter of the year.

In addition to California’s devastation, 2025 has brought a series of costly events across the globe, including severe wildfires in Japan and South Korea, a historic tornado season in the U.S., and rare extreme weather such as a Brisbane-area cyclone and record winds in Ireland. These events are placing consistent pressure on insurers and reinsurers to update risk models and rethink exposure strategies, especially in high-risk zones like the wildland-urban interface.

Cameron Rye, Willis’ director of natural catastrophe analytics, noted that the Los Angeles fires have been a wake-up call, prompting a deep reassessment of how wildfire risk is modelled. The company also warns that the upcoming North Atlantic hurricane season could drive losses even higher, potentially making 2025 one of the most expensive years on record.

The report underscores a growing concern within the industry: climate extremes are not just intensifying, but becoming the new normal. Willis climate expert Peter Carter suggests that the persistent trend of $100 billion-plus loss years may reflect a fundamental climate shift, requiring insurers and stakeholders to prioritize adaptation and resilience over mitigation alone.