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Windstorm loss mitigation - Best practice checklist

Losses from windstorms can be greatly minimized by adequate preparation before the storm arrives, including the development and implementation of a comprehensive written windstorm emergency plan.


> Read the full risk bulletin 'Hurricane Katrina 10 - Catastrophe management and global windstorm peril review'

Recent hurricane seasons have been comparatively mild in the US. In 2014 only one hurricane made landfall, causing little damage – the second year in a row without a major hurricane developing.

The beginning of the 2015 hurricane season constituted the longest streak without a major hurricane making landfall (Category 3 or above) since the 1860s, according to the Property Casualty Insurers Association of America (PCI).

Yet other recent events around the globe demonstrate the cost of complacency and reinforce how important it is to be adequately prepared for windstorm events.
Storm-related losses account for the top five insured natural catastrophe events around the globe during the first half of 2015, collectively totaling in excess of $5bn [1] with the bulk of these losses coming from extreme winter storms in the US/Canada and windstorm Niklas in Europe.

Such losses can be greatly minimized by adequate preparation before the storm arrives, including the development and implementation of a comprehensive
written windstorm emergency plan.

Pre-windstorm planning
/assets/Infographics/Hurricane%20Katrina/AGCSPreWindstormPlanning_large.jpg(Click on image to enlarge)

- Donwload the full windstorm checklist  -

 

During a windstorm                               After a windstorm
/assets/Infographics/Hurricane%20Katrina/AGCSDuringAndAfterWindstorm_large.png(Click on image to enlarge)

- Download a checklist for flood preparedness -


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[1] Munich Re, Geo Risks Research, NatCat Service - July 2015


Think about business continuity and communication

Even though business continuity management has become a much-discussed topic, not every business has best practices. After insurance has been paid - in some cases - this might only cover perhaps 40% to 50% of the total economic loss. Very often there is a loss of market share, suppliers, clients and qualified staff that the impacted business has to deal with. “An area of possible improvement here could be the evaluation of CBI exposures from national hazard events in addition to those from the direct supply chain,” says Stefan Kippert, Senior Account Engineer, Allianz Risk Consulting.

Plan (resources, contractors, repair, replacement)
/assets/Infographics/Hurricane%20Katrina/AGCSWindstormPlan_large.png(click on image to enlarge)

Claims response

Claims work starts long before a hurricane, storm or typhoon hits – it’s about preparing businesses for the worst-case scenario. “Businesses need to be sure to have tested business continuity plans and especially communications cascades in place and have insurance policies at a safe location,” advises Andreas Shell, Head of Short-Tail Claims, AGCS.

“Creating a separate booking account to which businesses can record hurricane-related damages to easily identify the loss incurred can also help.” According to Terry Campbell, Regional Claims Head, Americas at AGCS there are three things that every company should do to ensure the claims settlement process runs as smoothly as possible in the aftermath of a windstorm event.

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A flooded theme park in New Orleans after Katrina. Photo: FEMA/Bob McMillan via Wikimedia Commons.

“Follow the protocol outlined in the catastrophe response plan,” he says. “If there isn’t one in place, one should be immediately developed for that event. Ensure there is adequate staff to respond and that there is ongoing communication to include scheduled meetings to discuss progress as well as issues, problems etc. These can be done as frequently as necessary.”

Increasing influence of new technology

In order to keep up with rapid changes in risk concentration insurers such as AGCS are increasingly making use of modern technology and models to better aid risk assessment and response. AGCS is currently checking new technology such as drones, thermographic imaging and live streaming in order to gain access to otherwise inaccessible areas or property.

Satellite technology and 3D imagery means insurers can also locate risks more precisely – down to the level of individual buildings. But the best mathematical model in the world can only work if the data used is correct and the risk is clearly identifiable. To be even better able to assess risks in the future, geocoding per location and direct dialogue with the insured are fundamental.