Climate change and windstorms

The world’s climate is changing and the frequency of storms is impacted by variability in the climate. In 2017, the ABI together with catastrophe modeller AIR Worldwide and the Met Office collaborated on research into UK windstorms.  The research considered what effect global temperature increases of 1.5, 3 and 4.5°C would have on the frequency and intensity of UK windstorms.

The research highlighted that temperature increases of just a small number of degrees could lead to a large increase in insurance losses.   These increased losses would not be spread evenly across the country but would more likely to be concentrated in Northern Ireland, northern England and the Midlands, with southern England potentially seeing decreasing losses from storms.

This is based on Met Office analysis which shows that even small increases in temperature are likely to shift stronger winds further north. The full report can be found here.

Matt Cullen, Head of Strategy at the ABI, said: “Concerns about global warming often focus on rising water levels and the threat of flooding but this new research makes it clear the impact of other meteorological events such as high winds must not be overlooked.”

Extreme weather events are difficult to predict in advance. However, it is possible through analysis of vast volumes of historical data to understand and highlight the areas that are more at risk. Investing in technology and data models that are based on accurate, up-to-date information and that take account of changing risk patterns to gain a deeper insight into risk is crucial for insurers to ensure they are not selected against or over exposed in high risk areas.

Business Insight has Storm models for both residential and commercial properties.  Based on extensive research and the largest source of storm claims information available in the UK, the Storm Insight© models consider the variation in peak wind gusting across the UK together with factors such as topography, urban density, the local built environment and the likely state of repair of buildings to predict annualised loss estimates right down to individual property level. The models have been calibrated using over 72 million windspeed recordings focussed on areas where the UK’s insured population lives and use information supplied by a market leading supplier of weather information to the UK insurance industry.

To find out more, please contact your Account Manager or contact us on 01926 421408.

The Great Storm of 1987 – 30 years on

After the devastating effects of Storms Harvey, Irma and Maria on the US and Caribbean Islands, we revisit the great storm of October 1987.  Experts are already saying that Storms Harvey, Irma and Maria could end up being three of the costliest storms in modern times. AIR Worldwide has put potential insured losses for the three storms in total at an astonishing $155bn. We are lucky in the UK that we don’t get storms of this type hitting our shores. Indeed, major storms causing losses in excess of £1bn are rare events in the UK. On the 16th October 2017, it will be thirty years on from the Great Storm of 1987.

Referred to in the industry as ‘87-J’, the storm took everyone by surprise and at the time, was classed as the UK’s worst storm since 1703. It still remains one of the most severe and costliest windstorms the UK has ever experienced. One in six households made a claim at the time and losses to the industry for commercial and residential cover exceeded £1.3bn.

Striking in the middle of the night, the 1 in 200-year storm left behind a trail of damage and devastation in the South East of England and Northern France with 18 people losing their lives and extensive damage to property and infrastructure. Many houses were without power for several days and fallen trees blocked roads and caused travel chaos. An estimated 15 million trees were uprooted and Seven Oaks famously became One Oak.

The worst affected areas were parts of Greater London, the Home Counties and the East of England. The South East of England experienced unusually strong wind gusts in excess of 81 mph lasting for 3 to 4 hours and gusts of up to 122 mph were recorded at Gorleston, Norfolk.

The exact path and severity of the storm were very difficult to predict using the forecasting methods and data available at the time.  The Met Office’s Michael Fish faced a backlash for dismissing a viewer who had asked about whether the UK could expect a hurricane but at the time it was hard to forecast the precise path the storm would take. The path of the storm and the direction of the wind were very unusual; running from south to north, with the storm striking the more densely populated areas of the South of England.  The South of England has higher concentrations of sums insured and this resulted in a large loss for the Insurance Industry. Subsequently, changes were made to the way forecasts are produced and the National Severe Weather Warning Service was created.

A better insight into windstorm risk

Data modelling and analytical tools to help underwrite and price property risks accurately for natural perils have come a long way since 1987 when data on individual properties was scarce and geographic risk assessed by postal district. Insurers are now much better equipped to gain an in-depth understanding of risk exposure with access to risk models that are based on up-to-date, accurate information and that take account of changing risk patterns.

Business Insight’s ‘Storm Insight’ risk rating model. is based on extensive research, huge volumes of explanatory input data and cutting-edge analytical techniques. Storm Insight utilises the largest source of storm claims information available in the UK, detailed property vulnerability data for every street and over 100 million historic windspeed data points recorded in urban areas across the UK.  We also have access to an archive of actual storm event footprints over the last 150 years to gain insight into rare events such as the 87-J Storm.

What would the industry loss be if 87-J were to happen again?

In 1987 the losses from the great storm on 17th October resulted in over £1 billion in insured losses to domestic property as well as significant damage to commercial property. Things have moved on since then, in terms of housing development, levels of affluence and insured values at risk. Over the last 30 years, there have been significant increases in housing development across the South of England in areas that were in the path of the storm in 1987.

Official figures from ONS show the number of residential properties in England increased by 28% between 1987 and 2017. In London (Outer and Inner) the increase has been 32%. Coupled with that inflation has more than doubled over the last thirty years and, perhaps more significantly, the wealth across the South East of England and London has increased enormously. Many more properties across the housing stock have been extended in 2017 compared with 1987 and the total insured values at risk is of an order of magnitude higher. The level of wealth is also far higher with one in ten households now reported as having assets worth more a £1 million.

If the UK were to encounter the same storm again in October 2017, the loss to the UK Insurance Industry would not be in the same league as recently reported losses in the USA and Caribbean though it would still break all previous UK records. In our view, it is likely that losses to the UK insurance industry for such an event would exceed £6bn.

How Insurers can gain a richer, deeper understanding of Risk Exposure

BIBA image v1Business Insight will be exhibiting at BIBA 2016 and will be demonstrating our geographic risk mapping tool, Location Matters, designed to assist insurers with underwriting, exposure management and risk selection.

We’ll be exhibiting alongside the Geoinformation Group to bring our best of breed quote enrichment and underwriting solutions to UK property Insurers.   Combining high quality property and perils data which provides insurers with a deeper understanding of risk exposure, improves risk selection and helps to drive business growth.

The rich address level data resources (which includes Ordnance Survey’s AddressBase), deep analytical experience and insurance industry knowledge have been combined to offer highly innovative, new computer perils risk models by location and detailed property vulnerability databases to the insurance industry.

The solutions offer a more accurate understanding of the impact of the risk of flood, subsidence, storm, freeze, theft or escape of water.

Delivered via a number of state-of-the-art mapping solutions, including the Location Matters© data platform, they support underwriting decisions, improve risk management and drive more profitable risk selection.

Benefits include:

  • Detailed and accurate assessments of risk
  • Improved underwriting decisions
  • Competitive intelligence
  • Deeper understanding of risk exposure.

BIBA 2016 attendees can visit Stand B79 to find out more.   Or contact us on 01926 421408.

Business Insight sponsors 2016 First Utility Super League Club Wakefield Trinity Wildcats

Trinity Wildcats logo square for websiteBusiness Insight is pleased to announce that they will be sponsoring the rugby league club Wakefield Trinity Wildcats for the 2016 season.

With the 2016 season due to start on 4 February 2016, this promises to be another great year for the First Utility Super League.

Find out more in our press release: Press release 21 January 2016 Trinity Wakefield Sponsorship

Business Insight exhibit at Flood Risk & Insurance Event

The GeoInformation Group & Business Insight are working together to bring insurers sophisticated data and solutions to help them better understand the location, physical properties and structure of buildings across the UK.

Combining the extensive experience and feature rich data resources of The GeoInformation Group with the market leading analytical modelling of Business Insight has resulted in a compelling, innovative solution for the UK Insurance Industry.

The solution combines accurate, detailed and reliable data with best of breed perils databases to provide high resolution predictions of the risk of theft, fire, freeze, storm, subsidence and flood for both residential and commercial insurance.

Both Business Insight and The Geoinformation Group will be exhibiting at the Flood Risk & Insurance 2015 Conference which takes place on 29 October 2015.


Business Insight sponsors Classic Car Charity Rally to the Arctic Circle in aid of Help for Heroes

Business Insight is sponsoring a Classic Car Rally from London to the Norwegian Nordkapp in support of Help for Heroes. The challenge is to drive 3000 miles into the Arctic Circle in under 82 hours. There are nine teams taking part all driving Porsche 944s that individually cost less than £1100. The route to the most northerly point of Europe, via Brussels, Berlin, Warsaw, Vilnius, Riga, Tallinn and Helsinki, should take around 82 hours. All funds raised will go to Help for Heroes.

Read press release here: Press Release – Business Insight sponsors Porsche Classic Car Rally to Arctic Circle in aid of Help for Heroes

Business Insight hires leading analytics industry specialist

MasterBusinessInsightLogoBusiness Insight is delighted to announce that Dr. Alan McLachlan will be joining the team as Analytics Technology Principal to support the further development of its risk assessment product suite.

Alan is a highly experienced analytics and technology specialist and previously worked in a senior consulting role for Vodafone and before that in a number of senior roles at blue chip companies. Prior to that, Alan worked in academia as a research fellow studying Quantum Theory and he holds a PhD in Physics, an MSc in Neural Computing as well as achieving a first class Physics degree.

Read press release here: Press Release – Business Insight hires Analytics Principal 120912