Using Geo-Spatial Data to Model Flood Risk (and More…)

Flooded Street (red sign)

Flooded Street (red sign)

With UK homes and business suffering from another round of summer floods government advisors say we can expect more of the same over the next 20 years if climate change predictions are accurate.

So as flooding increasingly becomes par for the course more and more insurers, who typically bear the brunt of the costs associated with floods, are turning to geo-spatial risk mapping technology to help them manage their exposures.

That was one of the key messages at an ESRI UK Geospatial breakfast briefing that I attended on Tuesday, July 10, in the Willis auditorium.

What is Geo-spatial Data?

To put it technically: Geo-spatial mapping is an approach to apply statistical analysis techniques to data which has a geographical aspect (think Google Earth). It is “revolutionising” the way the insurance industry sees and uses data and it is helping carriers to visualise their risks and mitigate them like never before, explained Rowan Douglas, CEO of Willis Global Analytics and Chairman of the Willis Research Network (WRN). “WRN sits between the insurance world and academia to understand and explore the extremes of risk,” he said in his opening remarks.

In case you missed the actual event—here’s some of the interesting stuff that I learnt. Oh, and you can “follow” the WRN on Twitter @AnalyticsWillis so you don’t miss our next event.

At the event, which was attended by an audience of insurance risk managers and WRN members, I heard from Eleanor McLachlan (Aviva) and Jill Boulton (JBA), a supplier of flood modelling data, who both explained the benefits of geo-spatial awareness particularly in the area of flood risk management.

The ability to manage and interrogate data spatially is integral to the insurance industry, according to these speakers, because, if you think about it, all insurance data is spatial (e.g. policies, claims and perils).

Other Applications

But it’s not just the area of flood risk management where geo-spatial data is used. Hasan Karim (Zurich) explained how his company is using the technology to understand and map supply chain risks, in particular to visualise the dependencies and critical choke points within supply chains.

I saw how overlaying geo-spatial risk data on top of a map of key supplier locations helps to give a clearer picture of the overall impact of disruptions on the business. Clever stuff!

It’s important not to get hung up on the actual peril, like floods or ash clouds, and focus on the impact, i.e. disruption, that a range of similar events could have on your business. So whether it’s a major flood or the grounding of air traffic as the result of volcanic ash both of these things could lead to severe supply chain disruption.

How is that going to affect your business? That’s the tricky part. Perhaps geo-spatial risk maps can help shed some light on it.

Finally, Nigel Davis, head of platforms and delivery, at Willis Global Analytics and the WRN, gave an in-depth but high level presentation about future and emerging applications of geo-spatial data, particularly in the reinsurance and insurance broking worlds.

One of the most interesting things I heard in this section of the event was about how social media is being incorporated with geo-spatial technology to give people early warnings about events.

So for example, monitoring social networks, like Twitter or YouTube, might have given you an earlier “heads up” than the mainstream media did about the Arab Spring uprisings. By keeping an eye on these networks you can try and mitigate risks as they happen.

About Nathan Hambrook-Skinner

Nathan Hambrook-Skinner is Director of Communications, GB, for Willis Towers Watson. Nathan has recently published …
Categories: Analytics, Reinsurance, Weather risk | Tags: , , ,

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