View this article online: https://www.insurancejournal.com/news/international/2010/10/07/113885.htm
Willis Re, the reinsurance arm of global insurance broker Willis Group Holdings, has released “detailed risk estimates and large event scenarios for key cities including São Paulo, Santiago and Bogotá.” Willis said the models, developed by its Willis Research Network (WRN), will “help clients to optimize their related portfolios and manage their downsides for flood risk. Going forward, the tools might also be used to consider the potential impact of climate change.”
The models incorporate “multiple sources of flood risk” and are based on “advanced modeling techniques and analysis undertaken by WRN member Ambiental. The flood models provide South American insurance and reinsurance firms, as well as local governmental organizations, with new information that helps to identify and manage their exposure to flash floods caused by heavy rains and riverine overflow. Related results will be available for individual companies as well as the market as a whole and will have implications on planning, reinsurance and risk mitigation.”
Dr. Justin Butler, Managing Director, Ambiental pointed out that the “CAT modeling companies haven’t yet focused on Latin America and the lack of tools has made it extremely difficult for insurers to evaluate flood risk. We’ve now gone some way to solving the problem with simple prototype flood models which can be expanded as more data is collected.”
Dr. Juan England, Deputy Managing Director, Willis Re and leader of the reinsurance broker’s catastrophe risk modeling in Latin America, presented the models at the Geneva Association’s 2nd Climate Change and Insurance meeting held in São Paulo on September 27.
Gero Michel, Managing Director, WRN, explained: “Flood risk forms a core part of the Willis Research Network’s natural catastrophe research. Combining our high flood modeling expertise with an in-depth understanding of the local market in South America will make this project a success. We foresee that related models will not only help clients to manage their exposure to these risks, but will also aid in maximizing their performance through more informed underwriting and by managing smart reinsurance coverage.”
Margo Black, CEO Willis Re, Brazil added: “Urban flood risk is an acute concern for Latin American re/insurers who have been challenged by growing losses and the lack of models to guide risk management. This work, driven by the WRN, will help our clients to manage their risk and downside accurately and we look forward to making it available to the market.”
Source: Willis Group Holdings