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The UN’s “Future Trends in Geospatial Information Management” underscores how the ever-increasing size and complexity of existing data sources require technologies that can effectively integrate, analyze, and identify actionable insights from a wide array of sources.
Several severe weather events began a damaging start to the severe thunderstorm and tornado season this year, with damages expected to reach well into the hundreds of millions of US Dollars. With 2020 being the costliest year on record for severe storm peril, risk and insurance professionals should carefully monitor and proactively prepare to adjust risk strategies as events unfold.
Geospatially visualizing risk exposure data is crucial for risk and insurance professionals as the quantity of data increases every year – “the data is either too large to grasp or it’s not clear how the data is being manipulated.”
Investing in #insurtech adds flexibility for underwriters, brokers, and clients to stay informed and connected on constantly changing risks. Especially for global risk and insurance professionals, “a legacy system [can] not hold up to an ever-changing tech landscape.”
Quote of the Week: “A risk-informed approach fit for the digital age is one that is strategic in considering the impact of risk on strategy and performance; balanced in evaluating both opportunity and risk; integrated with strategy setting, planning and business execution; and customized, reflecting organizational business needs, expectations and cultural attributes.”
Stronger flood insurance mandates may be on the horizon in the United States as FEMA prepares to adjust their flood risk assessment system. A reason to be hopeful: “Technology is changing the way the insurance industry understands and measures risk” to allow risk and insurance professionals to properly analyze and communicate these changes internally with stakeholders and externally with clients.
FEMA is planning to announce its “Risk Rating 2.0” that will dramatically revise risk assessments for flood risk properties. Proactively understanding and preparing for these changes is a necessary first step for risk and insurance professionals to take sooner than later.
QotW: “Data is the new oil, but it’s maybe the crude oil. It’s messy. It needs to be refined. [GIS] clean that data in a way that removes its caveats, removes its impediments for scaling, so that lots of people can go ahead and [use] it.”
Single-model approaches to catastrophic risk is the norm for many risk and insurance professionals, which increases the fragility of risk strategies. Instead, researchers recommend a multi-risk model especially as climate risks increase in the new decade.
Climate risk blind spots present a significant challenge for risk and insurance professionals relying on climate risk disclosure initiatives for guidance. Granular insights into exposure is critical as climate risks continue to rise, and “Developing strategies that meet these objectives requires a more robust understanding of the potential risks from physical climate hazards.”