Hurricane Matthew reminds organizations of the benefits of being prepared for the unpredictable
Following the massive flooding in parts of eastern North Carolina and the Atlantic coast, Aon reminds risk managers of Flood Secure, an insurance facility providing replacement coverage to U.S. organizations that have impaired aggregated flood limits on their property policy.
Flood coverage is one of the few aggregated limits found on most property policies. Following Hurricane Matthew, and to mitigate the risk of additional floods going uninsured, Aon Risk Solutions, the global risk management business of Aon plc (NYSE: AON), created an industry-leading flood limit reinstatement facility for its clients. With Aon Flood Secure, replacement coverage can be provided to organizations with impaired aggregated flood limits.
Aon Flood Secure offers pro-rata pricing for reinstated limits and terms of less than 12 months. It is designed to replace eroded or exhausted flood aggregate coverage and to match existing carrier agreements to provide immediate reinstatement of impaired flood coverage.
Aon Flood Secure can also be secured with a call option. Aon Flood Secure Flex secures flood capacity at a pre-determined nominal cost, providing organizations with greater flexibility as to when or if they decide to reinstate exhausted or eroded flood limits. The nonrefundable call option costs 10-20 percent of the Aon Flood Secure premium and is based on the limit and policy term. When an organization decides to trigger the option, the balance of the Aon Flood Secure premium is due immediately.
“The economic toll is yet to be fully realized, but experts report that much of the damage may be tied to storm surge and inland flooding caused by rain from Hurricane Matthew,” said Rick Miller, U.S. Property Practice Leader of Aon Risk Solutions. “Flood Secure and Flood Secure Flex provide up to $25 million in additional flood limits, both high hazard and traditional. Each risk is separately underwritten with policy terms up to one year.”
Flood Secure is not intended as a replacement for National Flood Insurance Program coverage. All descriptions, summaries or highlights of coverage are for general informational purposes only and do not amend, alter or modify the actual terms or conditions of any insurance policy. Coverage is governed only by the terms and conditions of the relevant policy.