A flood of data

Carriers have taken the lead on advanced data analytics related to water damage risk. But commercial brokerages will soon be looking to buy or access the same information that their carriers have, says Michael Loeters, senior vice president for commercial insurance and risk management at Prolink.
– As told to Greg Meckbach

Insurers are updating their flood models with new climate data. This gives them a better idea of which urban areas are more vulnerable than others to risks such as sewer backup. I am telling you without a shadow of a doubt that brokers are going to have to invest in buying that same data. It is the only way we are going to be able to advise our clients properly. Insurers have greatly improved their data on property flood risk. They tend to have good data on the claims histories of commercial properties, and they supplement this data with information from municipalities. Brokers are investigating how — and the cost — to buy the same data that insurers are using. Better flood models allow insurers get a better control of their risk. The same is also true of brokers, which is why they should have access to better flood data. Data can help us to understand the issues before we submit a quote to the markets. If a client is thinking of leasing space in a property, for example, I want to know ahead of time if that property is at high risk of flood and therefore uninsurable. If it’s going to be an automatic decline, I need to know that, so that I can plan accordingly and find a different way to get my client covered. Data can help us do that.