AAUI highlights natural disaster risks and insurance protection gaps

The Indonesian General Insurance Association (AAUI) is highlighting the growing importance of risk management and reinsurance capacity in the face of increasing natural disaster threats. AAUI Chairman Budi Herawan noted that the industry must address accumulation risk, where a single event like an earthquake, flood, or tsunami impacts multiple insured objects within the same region simultaneously.

Despite the rising frequency of catastrophes, a significant protection gap remains. Data from the Swiss Re Institute indicates that in 2025, global economic losses from natural disasters reached approximately US$220 billion, but only about US$107 billion was covered by insurance. Over the last decade, an average of 58% of global economic losses from natural disasters have remained uninsured.