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Aon data empowers Unica to offer flood insurance for $5.2bn Canadian peril

Aon data empowers Unica to offer flood insurance for $5.2bn Canadian peril

WATERtight™ provides a single-solution coverage for water damage losses

Impact Forecasting, Aon Benfield’s catastrophe model development team, has enabled Unica Insurance Inc.to offer new a flood insurance called WATERtight™ following the devastating natural catastrophe events of 2013. Aon Benfield is the global reinsurance intermediary and capital advisor of Aon plc (NYSE:AON).

After Calgary experienced USD5.2 billion of economic damage from floods in 2013 – plus an additional USD1.7 billion in Toronto – it triggered demand for river flood insurance for personal lines which had historically been covered by the government. With a new catastrophe model, Impact Forecasting stepped in to help insurers better understand this risk and seize the opportunity of developing sustainable and affordable flood insurance products.

By taking data on frequency, severity and location from the model, Impact Forecasting was able to help Unica calculate its primary rates by identifying the flood risk around individual properties. Now, WATERtight™ is offering coverage for damage caused by overland flooding, ground water, surface water and sewer backup through Unica’s Homeowners, Condominium, Seasonal Homeowner, Tenant and Rented Dwelling products.

SarkaCerna, Impact Forecasting’s Business Development Representative, commented: “Impact Forecasting’s model and data is transforming how insurers can underwrite flood.  It’s rewarding to see the data already having an impact with Unica launching a new flood insurance cover in Ontario, Canada based on the insights. This collaboration really underpins Impact Forecasting’s commitment to Canada for the long term.”

Martin Delage, President and COO of Unica, explained: “Impact Forecasting’s data has been critical to improve our understanding of the flood risk in Canada which has become an increasingly important focal point for the industry as we seek new ways to mitigate future loss.  Equally, it has enabled us to offer protection from flood damage for an affordable property premium for families and businesses alike.”

The model, which covers a geographical area representing 98% of the Canadian population, also enables insurers to understand the impact of accumulations on their portfolios, structure reinsurance cover and fulfil regulatory and rating agency requirements. It provides model licensees with full transparency and access to the model components via Impact Forecasting’s loss calculation platform ELEMENTS.

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