Flood related insurance losses in 2013: Improving loss control with Flowroute-i™

December 11, 20130 Comments

Flood related insurances losses in 2013

Back in July of this year Reactions magazine reported that 47% of 2013 NatCat losses were incurred due to flooding. Since the publication of that article, major floods have affected areas as diverse as Colorado in the United States to the border regions of Russia and China. From our analysis of AON Benfield’s Impact Forecasting, flood related insurance losses from just ten of this year’s major flood events cost the insurance industry $9.6 billion. Below we have summarised both economic and insured losses resulting from floods in 2013, plus a summary of how Flowroute-i™ can be used to improve loss control.

Economic losses caused by flood events in 2013

Major flooding in Europe caused the worst economic losses in 2013, topping $22 billion. China, hit by multiple severe flood events throughout the year, follows as the 2nd worst affected region with at least $17.3 billion in losses. In total, $63.2 billion of known economic losses have resulted from flood events in 2013 (estimated to the end of November 2013. Source: AON Benfield).

Economic losses from flood events in 2013

Insured losses from ten significant flood events in 2013

Low insurance penetration in regions such as China, Indonesia and Southern Africa has meant that insured losses in those regions is fairly insignificant despite the mighty impact of events such as Super Typhoon Haiyan in the Philippines. As a result, Central Europe tops the list of areas most affected by flood related insurance losses, with $5.3 billion in claims. In total, the following ten major flood events caused $9.6 billion in insured losses.

Flood related insurance losses in 2013

Indonesia – January 2013
Structures/Claims: 100,274+
Economic Losses: $3.31 billion+
Insured Losses: $311 million

Australia – January 2013
Structures/Claims: 87,843+
Economic Losses: $2.5 billion+
Insured Losses: $862 million

Argentina – April 2013
Structures/Claims: 105,000+
Economic Losses: $1.3 billion+
Insured Losses: $503 million

Central Europe – May and June 2013
Structures/Claims: 100,000+
Economic Losses: $22 billion+
Insured Losses: $5.3 billion

Canada – June 2013
Structures/Claims: 25,000+
Economic Losses: $5.3 billion+
Insured Losses: $1.95 billion

Sources of data: AON Benfield, Post

India – June 2013
Structures/Claims: 25,000+
Economic Losses: $1.1 billion+
Insured Losses: $250 million

United States – September 2013
Structures/Claims: 25,000+
Economic Losses: $2 billion+
Insured Losses: $150 million

New Zealand – September 2013
Structures/Claims: 2,000+
Economic Losses: $20 million+
Insured Losses: $12.5 million

India – October 2013
Structures/Claims: 75,000+
Economic Losses: $260 million+
Insured Losses: $162 million

Philippines, Vietnam, China – November 2013
Structures/Claims: 1.3million+
Economic Losses: $5.8 billion+
Insured Losses: $100 million

Using Flowroute-i™ to improve loss control

Ambiental’s precision flood model, Flowroute-i™, was originally developed over 10 years ago in close collaboration with flood scientists at Cambridge University, UK. The model consistently performs exceptionally well in validation tests. In 2011, our Brisbane model validation achieved 95% accuracy compared to the existing national flood model which scored 37%. You can read the full case study here.

Brisbane flood model validation100 year flood model with Ambiental data overlaid compared to existing national flood model.

With flood related economic losses of $2.5 billion and insured losses of $862 million in Australia alone, earlier this year, it is clear that insurance firms require increasingly sophisticated and accurate technology to aid their loss control. Flowroute-i™ provides this precision and accuracy, with detailed and easy to understand flood information for all major sources – pluvial, fluvial and tidal, for any region across the globe.

Further information on Flowroute-i™ and its application for insurance purposes can be accessed here. To speak to one of our consultants about the availability of flood models for your territory, you can get in touch.

Filed in: Insurance News

About the Author ()

James Hubbard is part of Ambiental's technical team and takes responsibility for managing the company website.

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