New flood data will boost breadth of coverage in Canada
Impact Forecasting, the catastrophe model development team of Aon Benfield, has enabled Unica Insurance to offer new flood insurance coverage from a catastrophe model created following the widespread flooding in Canada in 2013.
The cover, WATERtight, uses an Impact Forecasting flood model and calculates an insurer’s primary rates by identifying the flood risk around individual properties.
The flood insurance now offers coverage for damage caused by overland flooding, ground water, surface water and sewer backup.
Impact Forecasting’s flood model covers a geographic area representing 98 percent of the Canadian population.
It enables insurers to understand the impact of accumulations on their portfolios, structure reinsurance cover and fulfil regulatory and rating agency requirements.
The widespread flooding in Calgary and Toronto in 2013, which incurred economic damages of $5.2 billion and $1.7 billion, respectively, had triggered a greater demand for flood insurance for personal lines, according to Impact Forecasting.
Flood insurance for personal lines had historically been covered by the Canadian government, so Impact Forecasting believes its new model means insurers can better understand the risk and develop sustainable and affordable flood insurance products.
Sarka Cerna, business development representative for Impact Forecasting, said: “Impact Forecasting’s model and data is transforming how insurers can underwrite flood. It’s rewarding to see the data already having an impact with Unica launching a new flood insurance cover in Ontario, Canada based on the insights. This collaboration really underpins Impact Forecasting’s commitment to Canada for the long term.”
Martin Delage, president and chief operating officer of Unica, added: “Impact Forecasting’s data has been critical to improve our understanding of the flood risk in Canada which has become an increasingly important focal point for the industry as we seek new ways to mitigate future loss. Equally, it has enabled us to offer protection from flood damage for an affordable property premium for families and businesses alike.”
