Aon launches solution to better manage risks and reduce volatility in Japan
Global re/insurance broker Aon has partnered with satellite and monitoring specialist ICEYE to help insurers better manage their flood risk, in the wake of severe flooding events in Japan that triggered claims of more than $30 billion over the two-year period.
ICEYE builds and operates its own commercial constellation of SAR satellites that can image any location on Earth. Aon will combine ICEYE data with its proprietary building exposure to enable insurers to better understand the potential post-event impact on their portfolios, and help them reduce volatility.
The satellite solution combines ICEYE’s Synthetic-Aperture Radar (SAR) data with Aon’s digital building datasets generated by using Aon’s patented technology to deliver near real-time insights on the potential consequences of flood events. This allows insurers to assess the potential impact of a flood on their portfolio within 24 hours of the water’s peak, enhancing insurers’ reserving and claims handling process with a faster response time.
According to the Japan Meteorological Agency (JMA), Japan experiences an average of three typhoon landfalls and several flood events annually. In 2018 and 2019, the country was subject to three of the five largest wind and flood insurance losses in Japan’s history, with insurers settling claims of more than $30 billion over the two-year period.
Rupert Moore, chief executive officer of Aon’s Reinsurance Solutions in Japan, said: “ Aon and ICEYE share a belief that better data leads to better decisions and, in turn, better outcomes. Our collaboration with ICEYE aims to assist clients with improving the robustness and accuracy of their responses to flooding events in Japan as they navigate this form of volatility.
“The combination of ICEYE’s technology and Aon’s buildings database provides a unique and innovative way for them to better address potential claims post-flooding in the country with more information and insights.”
Rafal Modrzewski, ICEYE’s chief executive officer, said: “Both of our firms have a laser focus on helping insurers reduce their combined ratios, improve their service to policyholders and close the protection gap. The collaboration between ICEYE and Aon demonstrates our continued commitment to helping clients leverage innovations that deliver strategic value. Together we are enabling the kind of digital transformation that will lead to a step change in efficiency and client service for the insurance industry.”
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