Munich Re says natural catastrophe risks are rising and has warned against complacency following lower losses in recent years.

“This [trend] is not only evident in heatwaves and continued hail events, but also in cyber threats, persistent cost pressure and single hazards that trigger interconnected impacts,” the reinsurer said.

Munich Re notes growing exposure remains a major driver of natural catastrophe losses in Europe, where non-peak perils accounted for about 70% of insured losses over the past 20 years and the effects of climate change are increasingly visible.

“Periods of lower losses in natural catastrophes must not lead to complacency about the risks ahead,” board of management member for property and casualty reinsurance in Europe and Latin America Clarisse Kopff said. “We have seen insured nat cat losses in Europe rise by an average 5% per year since 1980, with the rise accelerating in the last decade.”

The company says traditional reinsurance remains the cornerstone of capacity, amid growing market complexity and shifting dynamics.

“Traditional reinsurance combines dependable capital with deep expertise, innovative solutions for an increasingly complex risk landscape, and the financial strength to pay large claims when they arise,” Ms Kopff said.