Swiss Re: cat losses for '06 mild compared with prior years.

Insurance costs from natural catastrophes were lower in 2006 than the previous two years for two reasons: a lower number of major events, and fewer events striking areas with high insurance penetration, according to reinsurer Swiss Re Group.

In its latest sigma report, the reinsurer said losses due to natural catastrophes and man-made disasters in 2006 were below the long-term trend. And of the $48 billion in catastrophe-related economic losses, just $15.9 billion was covered by insurance, the third-lowest year for insured losses since 1990.

In contrast to 2004 and 2005, when the biggest catastrophes hit the southeast United States, Swiss Re pointed out that last year the majority of natural catastrophes hit developing countries that have a relatively low level of insurance penetration.

Last year, Swiss Re estimated total insured losses from catastrophes for 2005 at $83 billion. For 2004, the insured-loss estimate was $18.5 billion.

About 31,000 people died in these events all over the world, with the worst fatalities coming from the 6.3 magnitude earthquake that hit Bantul, Indonesia, in May 2006, followed by the European heat wave that struck during June. The costliest catastrophes were the tornadoes that hit the United States in April 2006. The 2006 Atlantic hurricane season was far quieter than had been predicted, with a fewer number of events than in 2005. "Over the past decades, insured losses have shown a rising trend, due mainly to weather-related catastrophes," Swiss Re said in a statement.