Private Flood at the Crossroads – Sink (pun intended) or Swim?

Posted at Jun 14, 2017 8:00:00 AM by Bill Raymor


At Intermap Technologies we write about the ever-changing landscape of insurance, government, and natural catastrophe. Because of the pending reauthorization plans for the NFIP (H.R.1423 - National Flood Insurance Program Reauthorization and Improvement Act of 2017) currently working its way through Congress, our most recent blogs have been centered around flood.

As I support InsitePro (our software-as-a-service product for natural catastrophe risk analytics), I receive information relevant to the changes within the insurance vertical and how they are evaluating entry into a multi-billion dollar sector via the privatization of flood insurance. The backdrop here is that the NFIP is currently about $24B in debt, their rates are not actuarily sound, and Congress is supposed to fix it.

A.M. Best, founded in 1899, provides video segments about ‘all things insurance’ that are just a few minutes in duration where they discuss topics with the most influential folks in the industry.

I viewed a recording with A.M. Best’s Meg Green (who always asks very insightful questions) where she interviews Monica Ningen, managing director of Swiss Re property underwriting for the U.S. and Canada. The title of the interview is Data Breakthroughs Help Insurers Compete for Flood Coverage. “This must be about InsitePro,” I thought. This is what we do.

She discusses her view of what the new flood landscape may look like. Want a peek?

Ms. Ningen also speaks about:

  • From the NFIP, one in four claims for flooded properties are located in moderate to low risk areas…
  • Insurers must educate, because most property owners are not even aware that flood is not included in their standard policy
  • The largest change in the property flood industry surrounds flood mapping and modeling
  • That insurers can compete with the NFIP even in A zones because of the data and the analytics currently available, not just price

A while ago, Ivan Maddox wrote a blog piece called A Homeowner’s View of the Protection Gap. There are some eye-openers here, relevant to this AM Best segment. Protection Gap from a homeowner’s view. What?

Thanks to A.M. Best for these insightful videos, and to Ms. Ningen.

Topics: Flood Insurance, Insurance Protection Gap, Flood Risk, Risk Management

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