Natural disaster losses cost the world $225 billion last year and the insurance industry picked up about $90 billion of the tab.

Aon’s Weather, Climate and Catastrophe Insight report for 2018 found last year was the third year in a row to top the $200 billion mark.

Although insured losses were well down from the $147 billion logged in 2017, it was still the fourth costliest year on record for the industry.

However, with 40 per cent of economic losses covered by either private-sector insurers or public-sector schemes, the protection gap narrowed to its lowest level since 2005.

“Both 2005 and 2018 were years in which many of the biggest natural disaster events occurred in the United States, where insurance penetration is higher than in other parts of the world,” Aon’s report states.

The Camp Fire, in California in November, was the most expensive event for insurers, racking up $12 billion in claims of the $15 billion economic loss.

Hurricane Michael came in a close second with $10 billion in claims, although its economic losses of $17 billion were the highest for a single event.

Other expensive events included the typhoons Jebi and Trami in Japan, Hurricane Florence in the US, the Woolsey Fire in California, flooding in Japan, Windstorm Friederike in central Europe, plus a US drought and a hailstorm in Colorado.

The most costly events in terms of fatalities were an earthquake and tsunami in Indonesia, which left 2,256 people dead, and monsoon flooding in India, which caused 1,424 deaths. In total more than 10,000 people lost their lives in natural disasters last year.

• The full report is available online at http://bit.ly/if-annual-report-2018