what you don’t know about flood can hurt you

Floods rank in the top 10 global insured losses by value

with a total insured loss of USD 15.3 billion

Floods rank in the top 10 global insured losses by value

with a total insured loss of USD 15.3 billion

2012

Sandy

$25B

Floods rank in the top 10 global insured losses by value

with a total insured loss of USD 15.3 billion

2005

Katrina

$47B

2012

Sandy

$25B

Floods rank in the top 10 global insured losses by value

with a total insured loss of USD 15.3 billion

2005

Katrina

$47B

2012

Sandy

$25B $4B

2012

Europe Flooding

Floods rank in the top 10 global insured losses by value

with a total insured loss of USD 15.3 billion

2005

Katrina

$47B

2012

Sandy

$25B $4B

2011

Thailand Flooding

2012

Europe Flooding

$15B

Source: Central Europe Flooding by Jargo / CC BY-SA 3.0.

Floods rank in the top 10 global insured losses by value

with a total insured loss of USD 15.3 billion

more than 20 times Thailand's annual property premiums.

2005

Katrina

$47B

2012

Sandy

$25B $4B

2011

Thailand Flooding

2012

Europe Flooding

$15B

Source: Central Europe Flooding by Jargo / CC BY-SA 3.0.

In Canada, there are twice as many flood events as other meteorological disaster events.

In Canada, there are twice as many flood events as other meteorological disaster events.

43% Flood

In Canada, there are twice as many flood events as other meteorological disaster events.

43% Flood

16% Hail/Thunderstorm

In Canada, there are twice as many flood events as other meteorological disaster events.

43% Flood

16% Hail/Thunderstorm

12% Wildfire

In Canada, there are twice as many flood events as other meteorological disaster events.

43% Flood

16% Hail/Thunderstorm

12% Wildfire

9% Winter Storm

In Canada, there are twice as many flood events as other meteorological disaster events.

43% Flood

16% Hail/Thunderstorm

12% Wildfire

9% Winter Storm

20% Other

2013 Calgary Floods: Total damage estimates exceeded

C$45 billion.

Vancouver earthquake: C$17-22 billion for a 500-year event

Quebec flood: C$4.8-5.8 billion for a 500-year event

BC flood: C$7-10 billion for a 500-year event

Alberta flood: C$0.6-1 billion for a 500-year event

Ontario flood: C$5 billion for a 250- to 500-year event

Data source: Public Safety Canada, 2007

2013 Calgary Floods: Total damage estimates exceeded

C$45 billion.

Vancouver earthquake: C$17-22 billion for a 500-year event

Quebec flood: C$4.8-5.8 billion for a 500-year event

BC flood: C$7-10 billion for a 500-year event

Alberta flood: C$0.6-1 billion for a 500-year event

Ontario flood: C$5 billion for a 250- to 500-year event

Data source: Public Safety Canada, 2007

In terms of insurable damages, costliest disaster in Canadian history at

C$2.25 billion.

But how accurate is the data being used to underwrite this exposure?

Beware of false knowledge; it is more dangerous than ignorance.

Do insurers understand floodplain mapping well enough to underwrite

the risk due to flooding

Northern Canada

Central Canada Eastern Canada Western Canada

2013 Survey of Canada’s Largest Property/Casualty Companies

No Don’t Know

Yes No Response

The Federal Public Safety Department acknowledged the issue and ordered a new study to survey flood mapping in six countries, including the U.S.

Floodplain map boundaries are only as accurate as the topographic map

on which they are drawn. Due to the small scale of Survey maps, the flood boundaries

cannot be precisely mapped… Maps do not always represent exact

conditions on the ground.

How do we improve understanding of the Flood Risk

Increased understanding of:

Return Periods

Increased understanding of:

Flood Maps and Mapping Errors

Return Periods

Increased understanding of:

Flood Maps and Mapping Errors

Geocoding and Geocoding Errors

Return Periods

Increased understanding of:

Transforming information into

knowledge is a competitive

advantage.

Remember

Return Periods

For Flood Zone boundaries, indicate the chance of flood waters exceeding that level.

For the 100-year flood plain, the highest point of the water has a 1% chance of being exceeded in any year.

Flood Maps

Represent the primary flood risk assessment tool used by municipalities, insurance companies, banks, etc.

They do not evaluate individual properties and are very broad-based.

The 100-year flood plain is 33 meters, so everything below the line is Zone A.

All houses look the same on a flood map. Is the exposure the same?

100-Year Flood Elevation

31 m.

34 m.

32 m.

33 m.

30 m.

36 m.

39 m.

33 m.

Not all locations in the 100-year zone are the same.

Don’t rate them that way.

64 meters elevation

67 meters elevation

67.5 meters elevation

100 meters elevation

Geocoding

Assigns geographic coordinates to street addresses. Hazard mapping using geocoding technology

highlights areas that are vulnerable to a particular hazard, allowing the industry to better determine if a

specific location is subject to natural hazards.

Rooftop Resolution Inputting an address provides the latitude/longitude coordinates of the center of the parcel.

Inputting an address provides the latitude/longitude coordinates of the street in front of where the building is inferred to be.

Street Level

Rooftop vs. Street Resolution 1208

1208 SILVER LEAF CIR

1264 OAK CREST DR

1264

1223

1213

1217

1263 OAK CREST DR

1263

1228 SILVER LEAF CIR

1228

1255 1256

1260

1259

1260 OAK CREST DR

1256 OAK CREST DR

1232 SILVER LEAF CIR

1259 OAK CREST DR

1255 OAK CREST DR

1217 SILVER LEAF CIR

1223 SILVER LEAF CIR

Courtesy of NAVTEQ and CoreLogic

Calgary 2013

Aerial photo of a flooded Calgary Stampede stadium and Saddledome.

Source: The Canadian Press/Jonathan Hayward

Using the Latest Mapping Technology

Imagery Ⓒ2014 Google, Map data Ⓒ2014 Google

There is a 268-meter difference between the mapped point and where water actually started entering the facility.

If you were underwriting this risk, would “close enough” be good enough?

Underwriting using only standard flood maps

misses half the properties at risk.

About 30% of multi-claim properties located in flood zones are considered to be moderate or minimal risk.

Don’t be fooled.

Be vigilant about examining flood exposure,

risk by risk. Use all tools and technology available and understand their limitations.

Analyze elevation and topographical features that surround a risk.

To avoid adverse selection, uncover as much information as possible. And know when to investigate further.

Remember the old saying,

Close in flood underwriting puts you at great risk.

“Close only counts in horseshoes and hand grenades.”

For more information on underwriting flood exposure, contact

Tim Pappas.

© 2014 General Re Corporation | This presentation is intended to provide background information to our clients and professional staff. It is time sensitive and may need to be revised and updated periodically.

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+1 212 341 8021 p

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