JBA Risk Management® have released our new UK Climate Change Flood Model, the first of its type available for the UK, which projects that Annual Average Loss for residential properties in the UK could rise by 25-30% over the next 20 years as a result of climate change.
The model, which draws on the latest scientific understanding of climate change, will help re/insurers understand the impact of climate change across the country. It provides quantitative results that supports projections from research and government data that the number of UK flood events causing financial loss will rise between now and 2040.
For this model, Government climate change factors were used and statistical adjustments were made to JBA's large set of possible UK river, surface water and coastal flood events. The data generated provides an insight into potential changes to flood risk by 2040. The estimated rise in annual average loss of 25-30% is based on a residential property portfolio without adjustment for limits, deductibles or policies with flood exclusions. (Estimates of total damage exposure are available from the UK Climate Change Risk Assessment 2017).
JBA’s UK Climate Change Flood Model is a ground-breaking catastrophe model specifically designed to provide an indication of possible future changes to flood risk across the country. We have taken highly-detailed and complex scientific data and created a functional, forward-looking tool that insurers can use in conjunction with our UK Flood Model for decision-making and portfolio management.
The impact of climate change on flood severity and frequency presents increased uncertainty for insurers and reinsurers. Only the largest firms have the ability to develop in-house views on future flood risk. We are pleased to see the release of this model, enabling both large and smaller companies to quantify the potential impact on their exposure for the first time.
The JBA UK Climate Change Flood model is currently available on JBA’s JCalf® platform and the Nasdaq Risk Modelling service. For more information, read our executive briefing, get in touch or check out our latest blog.We also held a webinar to explore the impact of climate change for insurers and reinsurers- watch it today!
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