Natural disasters like March's earthquake in Japan will cost the global economy a record $350 billion this year, with losses for the insurance industry second only to 2005 when Hurricane Katrina hit New Orleans, Swiss Re said.

The Zurich-based reinsurer had already signalled 2011 would be a costly year for the insurance industry, which is also facing claims due to floods in Thailand and a quake in New Zealand.

Sectoral insured catastrophe losses for 2011 will amount to $108 billion, it said on Thursday.

"If Japan had been as well insured as other countries with high seismic risk, such as New Zealand, the overall industry tally would have been much higher," Swiss Re said, adding that additional claims from the flooding in Thailand or possible winter storms in Europe could push the tab still higher.

Yet the natural catastrophe hit will still fall short of the $123 billion picked up by the insurance industry in 2005. - Reuters