Manage UK Flood risk like never before

Flooding continues to pose a significant risk for re/insurers writing in the UK – now and under a changing climate. 

New JBA estimates suggest:

• The cost of severe UK flood events could escalate by 42% by 2050 – a 200-year flood event could rise to £5bn under an intermediate emissions scenario (RCP4.5).
• Average annual losses from flood are estimated at £527 million to UK residential properties under a baseline scenario, which could rise by 87% by 2050 under a no-action warming scenario (RCP8.5).
• We could see a 120% increase in the cost of surface water flash floods, particularly in the south and east of the UK under a no-action warming scenario (RCP8.5)
• The greatest change in flood losses is expected to come from coastal flooding, with 120% increase in coastal flood loss under an intermediate warming scenario and 150% increase under a no-action warming scenario by 2050
• Greatest increases in river flood are seen in central and western Scotland, north and mid Wales, the Humber, and the Bristol Channel where AAL could increase by over 100%

It’s vital that re/insurers start to understand this future risk, today.

Assessing potential future changes in risk and loss not only enables organisations to meet regulatory exercises, which require organisations to understand and own their view of risk better than ever before, but also to make effective business decisions now and in the future.

JBA has developed its newest UK Flood Model to meet these challenges – already the highest resolution model on the market and now the most flexible:

• 5m resolution – highest resolution on the market for identifying localised risk at individual property and portfolio level, covering all three major flood types (river, surface water and coastal).
• Underpinned by JBA’s FLY Technology – almost every element of the model is user customisable, from hazard data to vulnerabilities and sensitivity testing
• Two new climate scenarios providing an intermediate and no-action warming scenario by 2050, developed using the latest UK Climate Projections and brand-new methodology to produce new, bigger, wetter events, rather than adjusting existing events
• Accessible in a variety of ways – underpinned by Oasis LMF and accessible via Nasdaq Risk Modelling for Catastrophes, ELEMENTS from Impact Forecasting’s team, in-house installations and JBA bespoke consultancy services.

Re/insurers can now understand, manage and quantify UK flood risk like never before for.

The latest version of the model builds on over 10 years of flood modelling experience. Its predecessor, released in 2018, was industry used and approved as the model of choice for three of the world's top reinsurance brokers and used by financial organisations across the UK to meet CBES requirements.

Using the baseline model alongside the climate scenarios, users can understand both their risk today and how losses and flood risk may change over time. This helps with:

• Competitive reinsurance pricing
• Geographical hotspot identification
• Informed portfolio management and optimisation
• Effective accumulation and capital management
• Long-term competitive product development
• In-depth ‘what if’ investigation
• Transparent regulatory reporting

Interested in learning more about how this can help you? Leave us your details below to receive further resources and information from the team.