Losses tied to floods in Southeast Asia may grow as much as 10-fold in the coming years due to the rise of extreme weather events, according to Willis Towers Watson Plc.
Early indications suggest that major regional flooding events have the potential to cause economic losses in excess of $10 billion, compared with the $1 to $2 billion range typical of the past decade, according to the report published by the insurance broker.
“Warmer oceans, shifting formation zones and greater track sensitivity mean that past patterns are becoming less reliable guides to future risk,” Srivatsan Vijayaraghavan, senior research fellow at the National University of Singapore, and Daniel Bannister, weather and climate risks research lead at Willis Research Network, wrote in the report.
Last year ended with three tropical cyclones unleashing a wave of destruction from Sri Lanka to Indonesia that left more than 1,300 dead and caused at least $20 billion in losses. Countries in Southeast Asia consistently rank among those most vulnerable to such risks, with the Philippines, Myanmar and Vietnam among the 10 nations most affected by climate change in 2024, according to Germanwatch, an independent human rights organization.
“Risk鈥憀ayered disaster financing, combining public, private and parametric solutions is becoming essential to safeguarding long鈥憈erm resilience,” said Christopher Au, head of the APAC Climate Risk Centre at WTW, in the release. “They can help reduce volatility, support faster recovery and strengthen financial stability across Southeast Asia’s most disaster鈥憄rone economies.”
Following Super Typhoon Yagi in 2024, researchers at the National University of Singapore conducted a series of climate sensitivity tests. The results found that warming oceans will make storms more intense, and even small temperature changes can radically alter storm tracks, the WTW report said.
While climate change is seen as having exacerbated the impact of recent floods, scientists and analysts that deforestation, shortcomings in flood defenses and a lack of funding for disaster resilience heighten damages.
In other findings, the WTW report stated that natural catastrophes caused more than $100 billion in insured losses in 2025. That was a decrease of $40 billion when compared with 2024 as no hurricane made landfall in the US. Even so, last year marked the sixth time catastrophe losses have exceeded the $100 billion threshold.
Photograph: Flooding in the Philippines. Photo credit: John Dimain/Getty Images
Related:
- Severe Convective Storms Become Costliest Insured Peril of 21st Century: Aon
- Wildfires, Storms Fuel 2025 Insured Losses of $108 Billion: Munich Re Report
- LA Fires and US Severe Convective Storms Drive Insured Losses of $107B in 2025
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