Munich Re warns of rising risks from medium-sized natural disasters

Munich Re, the world’s largest reinsurer, has warned of a shift in insurance risk profiles, noting that medium-sized natural events are increasingly driving significant economic losses. During an industry meeting in Monte Carlo, the company highlighted the rise of ‘non-peak perils’—events such as severe hail and fire that fall below the threshold of major catastrophes but are occurring with enough frequency and intensity to accumulate massive damages.

For 2025, the company estimates costs from these developing trends at approximately 104 billion US dollars. Beyond sudden weather events, Munich Re identified extreme heat as a creeping but significant risk factor. Heatwaves are impacting public infrastructure, supply chains, agriculture, and the healthcare sector, even when direct causality is difficult to prove.

The company also noted that while extreme catastrophes remain a factor—such as the 54 billion US dollar damage from wildfires in California—the cumulative impact of frequent, mid-sized events is fundamentally changing how insurers must assess and manage risk portfolios.