Private – public – project:

Can insurance data help preventing natural catastrophes and urban flooding damage?

Mia Ebeltoft, Project manager

Background

• Heavy increase in “water related” damages and insurance claims– Old pipes and more heavy rain (a well known problem all over Europe)

• Frustrated (and angry) customers

• The Municipalities (Water services) doesn’t have the data, so very low knowledge about “vulnerable” areas are

• M are asking for the data (which the companies individually have said no, due to data protection)

• Insurance have to pick up the bill• Many law processes - conflict between municipalities and insurance - negative focus in media

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19801981

19821983

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19901991

19921993

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500

1,000

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2,000

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3,000

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5,000

Total "water" damages incl urban floodingvs land flooding and other natural perils

Total water damage

Land flooding

Other Natural Perils

Dam

ages

- m

ill N

OK

Findings from a pilot project:Using insurance claims data to strengthen municipalities’ efforts

to prevent climate-related natural hazards

Collaboration project between Finance NorwayWestern Norway Research Institute

Norwegian University of Science and Technology

What ”kicked off ” the project?

In order to improve adaptation, and to be able to prioritize, and to take the right, optimal decisions, you need to understand what is at risk and where are the “risk zones” (vulnerable areas).

The report NOU2010:10 recommended to (and by that challenges the insurance industry): ”Establish a database for public use and research using aggregate, anonymised

data on climate-related damage from the insurance companies and the Norwegian Natural Perils Pool”».

First public - private - partnership pilot project

• Financed by Finance Norway and the Ministry of Climate and Environment (through the “Cities of the Future” program)

• Red: Ten pilot municipalities (M)

• Orange: ”Extra/reserve- municipalities” in case some of the ten pilot M pulled out (= collected insurance data also for these M)

• Research partners:

– Western Norway Research Institute, and the Norwegian University of Science and Technology (NTNU)

• Project period: Sept 2013 to Febr 2015

Main goals

• Strengthen municipalities’ knowledge base for preventing water-related natural hazards

– New knowledge of where (water-related) injuries actually take place, which can strengthen the knowledge base for area planning and prioritize to operation/investment/planning for municipalities’ water and sewerage installations

– Could potentially also add value in terms of climate change, in the sense that adapting to today’s climate is halfway to adapting to future climate,

– Claims could help to secure an early warning system for changes in climate

• Secure and preserve an insurance system against nature- and water-based hazards

– If the amount of damages continue to grow this could lead to generally higher premiums, differentiated premiums and more recourses

• Strengthen trust between insurance companies and municipalities. – Today the law is unclear and they fight over liability in the courts

Project activities

Collect data

Analyse data

MunicipalitiesFinance Norway

Skade-data

Skade-data

Skade-data

Injury claims data

Insurance companies

Use data

WNRI/NTNU

Import data

Transfer data

Sources and type of data

• Collected claims data from 8 companies (covers approx 90 pre cent of the market)

• Type of data:

– Down to house no / clams address

• “natcat”- claims (storm, river flooding, landslides...).

• Storm water and back flow damages

• Plus other “water – damages”

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• Generally– Basis for better collaboration with the insurance sector – Basis for better collaboration within the municipalities (planning og technical) – New insights into risks previously unknown – Improved understanding of how climate change affects society

• Land-use planning– Improved knowledge base for localization of future development areas in order to select the areas

with the lowest possible risk of natural hazards– Improved knowledge base for the prioritization of security measures

• Construction and maintenance of water and sanitation– Improved knowledge base for prioritizing management, maintenance, rehabilitation, and reinvestment– Improved knowledge base for collaboration between municipal water/sanitation and planning units

• Public infrastructure– Stronger knowledge base for prioritizing security measures

• Preparedness– Improved knowledge base for risk and vulnerability analyses

The main conclusion

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The quality of the natural hazards data need to be improved, especially in two areas:

• Information about when the damages occurred, as opposed to the time when the damages form was filled in.

• More accurate information on where damages occurred: The damages must be related to an actual address or stated in the form of GPS coordinates.

• (Will be “solved” as new public “house numbers” are being used.)

• And the cause if possible

 

Challenge: improve insurance claim data

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Questions that need to be discussed

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• These data are the most concrete the insurance industry have to ”offer” in adaptation messures; to make the society more robust and sustainable

• Use of data should be part of the discussion in SUS NL• It should be part of the chart template

• Insurance industry in France and Norway (and others?) are already working towards others who see the need/are working with of data sharing:– UNEP FI PSI (Geneva)– Disaster Risk Reduction program (UN), herunder– European Forum for Disaster Risk Reduction (EFDRR)

http://www.unisdr.org/we/inform/events/35805

What´s next?