How will Hurricane Sandy affect your business?

by Bret Stone on October 29, 2012

With the imminent landfall of Hurricane Sandy in the Northeast, you need to understand your loss potential and prepare to mobilize your response. SpatialKey can help!

Hurricane Sandy Forecasted Track - October 29, 2012 2PM EDT

SpatialKey’s Hurricane Forecasts application allows you to estimate your potential exposure to hurricane events in real-time. With its seamless integration with NOAA, we have removed any impediments to you getting to the business at hand... understanding Sandy’s impact to your business! And to make this business-critical process even easier and more accurate, SpatialKey now calculates policy exposed limits, so you can estimate your actual exposure. Simply, select your insurance portfolio and begin analyzing your exposure in an instant.

Using a heat map, filtered by the windfield of Hurricane Sandy, you can quickly identify your concentrations of exposure. Here you can see that there are about 127 thousand locations, representing $1.0 trillion in Total Insured Value that are exposed to Sandy’s windfield and projected path.

Exposed TIV for Hurricane Sandy windfield

Since Sandy is going to make landfall in the Northeast, we want to focus in on that region and want to only evaluate exposure within the 50-knot and greater windfields that will prove more damaging. Based on the NOAA forecast, this insurance portfolio could expect about 43 thousand locations, representing $752 billion in TIV, to be impacted by this storm. A $752 billion impact is a daunting figure! However, being that $737 billion of that is Commercial business, we know that this figure is really not representative of actual exposure when measured on a TIV basis, so we need better information.

Let’s take a look at just Commercial business and leverage SpatialKey’s Policy Exposed Limit pod to paint a more accurate picture of our exposure. We now see that 298 policies are impacted in this region, totaling $1.6 billion in policy exposed limit.

Policy Exposed Limit for Hurricane Sandy wind speeds greater than 50 knots

Because we noted a high concentration of exposure in the New York City area, let’s zoom in to understand those exposures better. Here we see that this region has about $655.5 million in limits exposed across 164 policies.

Reviewing exposure concentrations in New York City area

Ten policies, each with greater than $15 million limits, generate about half of the exposure. Let’s filter by those policies and gain more insight about the distribution and composition of their covered risks. These 10 policies represent $186.6 million in exposed limit across 1,417 locations. Reviewing the construction characteristics, we can see that the majority of this exposure is limited to buildings with steel frame construction, which is less vulnerable to wind risk than other construction types.

Top 10 commercial policies

We can also get a full listing of locations that are impacted, which will bring focus to claims deployment and prioritization. Remember, SpatialKey offers a fully integrated analytic environment to make the interrogation of your data fully flexible across business, vulnerability, hazard and geographic dimensions.

Reviewing exposed locations for top 10 commercial policies

As you can see, SpatialKey’s Hurricane Forecasts app makes it easy to understand your loss potential associated with any hurricane event and do so with a greater degree of accuracy by leveraging the new Policy Exposed Limit feature. You can evaluate your portfolio risk in aggregate, by segments of your portfolio, and by policy and location, empowering you with any level of information you need. With superior ease-of-use and advanced analytic capability, insurers can quickly estimate risk, bring focus to their understanding of Hurricane Sandy and response scenarios, and better serve their customers with more intuition around where to deploy their claims force.

Topics: Hurricane, Insurance, Analytics, Event response

Popular Posts