The US$ 1.3 trillion disaster protection gap is widening, says new Swiss Re report

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Aon: California wildfire claims breach $1bn as peak season begins

CHICAGO, Oct. 8, 2015 /PRNewswire/ — Impact Forecasting, Aon Benfield’s catastrophe model development team, today launches the latest edition of its monthly Global Catastrophe Recap report, which evaluates the impact of the natural disaster events that occurred worldwide during September 2015. Aon Benfield is the global reinsurance intermediary and capital advisor of Aon plc (NYSE:AON).

The report reveals that several wildfires impacted California during the month; the Valley Fire, which occurred northwest of San Francisco, was the third-most damaging wildfire in state history, killing four people and destroying 1,958 homes and other structures. Forecast economic losses from the fire were in excess of USD1.5 billion, with preliminarily insured losses estimated at more than USD925 million.

Meanwhile, the Butte Fire, which occurred southeast of Sacramento and was the seventh-most damaging wildfire in state history, killed two people and caused total estimated economic losses of at USD450 million, with insurance losses expected to be above USD225 million.

With peak U.S. wildfire season in California having started in late September and lasting through early November, wildfires in 2015 have already caused more damage and financial loss in the U.S. than in any other year since 2007.

Adam Podlaha, Head of Impact Forecasting, said: “The severity of the September wildfires in California serves as a reminder of how costly the peril can be for the insurance industry. With insurers facing more than USD1.0 billion in claims payouts for the Valley and Butte fires alone, it makes it the costliest year for the peril since 2007. The peak of the California wildfire season is just beginning, and Impact Forecasting remains well suited to help our clients assess their risks given our brushfire model for the region.”

Elsewhere in September:

  • Officials in Indonesia declared 2015 as the worst year for wildfires since 1997, following a reported USD4.0 billion in direct and secondary economic losses from fires in Sumatra and Kalimantan.
  • A magnitude-8.3 earthquake impacted central Chile on September 16, triggering tsunami waves and killing 14 people. Over one million residents were evacuated as economic losses neared USD1.0 billion.
  • A magnitude-6.6 earthquake struck eastern Indonesia on September 25. Dozens of individuals were injured as nearly 2,500 homes and other structures were damaged or destroyed.
  • Extensive flooding affected portions of Japan, killing eight people and damaging or destroying 20,000 homes. Three large insurers in Japan estimated payouts of at least JPY30 billion (USD250 million).
  • Damaging floods were reported in the U.S., India, Myanmar, China, Burkina Faso, Nigeria, Spain, and throughout Central America and the Caribbean.
  • Typhoon Dujuan struck Taiwan and China, killing at least three people in Taiwan and injuring hundreds of others. Combined economic losses were listed at USD680 million; insured losses were USD79 million.
  • Severe thunderstorms in Italy prompted economic losses of more than USD2.2 million as widespread damages were reported to structures, vehicles, and crops.
  • 32 people were killed by lightning strikes in eastern India.
  • Drought conditions intensified across western Canada, as annual insurance claims in Alberta alone were estimated at up to USD675 million. Nationally, economic losses were estimated beyond USD1.0 billion.
  • A severe sandstorm killed 12 people as it swept through areas of the Middle East.

To view the full Impact Forecasting September 2015 Global Catastrophe Recap report, please follow the link:

http://bit.ly/1Q5YlS1

Along with the report, users can access current and historical natural catastrophe data and event analysis on Impact Forecasting’s Catastrophe Insight website, which is updated bi-monthly as new data become available:

www.aonbenfield.com/catastropheinsight

Further information

For further information please contact the Aon Benfield PR team: Andrew Wragg (+44 207 522 8183 / 07595 217168) David Bogg or Alexandra Lewis

   

This year’s theme is “Hear The Beep When You Sleep. Every Bedroom Needs a Working Smoke Alarm!”.

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Study finds; as zip line popularity soars, so do injuries

By Lindsey Tanner

THE ASSOCIATED PRESS

CHICAGO _ Injuries from zip line accidents have soared along with the popularity of an activity that hurtles riders through the air, sometimes at dizzying heights above ground, a study of U.S. emergency room data shows.

Over 16 years, nearly 17,000 people were treated for zip line-related injuries including broken bones, cuts and sprains; most occurred in the last four years of the 1997-2012 study. It’s the first national look at zip line injuries and highlights a need for better regulation and uniform safety standards, the researchers say.

The study was published Monday in the American Journal of Emergency Medicine. Deaths were not included _ there have been at least six nationwide this year, most from falls.

THE STUDY

The researchers analyzed a national injury database operated by the Consumer Product Safety Commission. Their study covers the early years of commercial zip lines, which now number more than 200 nationwide. There are thousands more “amateur” zip lines, located in backyards, summer camps and schools.

Most injuries occurred at commercial courses, camps and other non-residential places. About 30 per cent were from zip lines in backyards or farms. These are sometimes do-it-yourself kits bought online, may be improperly installed and should be avoided, the researchers said.

The annual injury rate for all zip lines climbed from almost 8 per 1 million U.S. residents in 2009 to nearly 12 per 1 million in 2012. Causes included falls, collisions and slamming into objects at the end of the course. Injuries were most common in children and teens.

Almost 12 per cent of injuries resulted in hospital stays, a worrisome rate much higher than more conventional sports, said co-author Tracy Mehan of the Research Institute at Nationwide Children’s Hospital in Columbus, Ohio.

STANDARDS & REGULATION

Industry groups have adopted voluntary safety standards typically involving equipment, maintenance and worker training, but they vary and are not uniformly followed. Insurance providers generally require operators to adhere to some of these standards, and several states have adopted safety regulations. But Mehan said a uniform set of safety standards and effective oversight is needed.

INDUSTRY RESPONSE

Industry representatives say the study is alarmist and that zip lines are safer than driving a car.

Mike Barker, vice-president of the Professional Ropes Course Association, said his group has strict safety standards that recommend that courses be routinely examined by independent inspectors. He said reasons for injuries and deaths include user or operator error and equipment malfunction.

James Borishade, executive director of the Association for Challenge Course Technology, said no activity is risk-free and that zip line operators “are working to minimize that risk.”

SAFETY TIPS

_Check the Better Business Bureau and online reviews to find a reputable operator

_Ask operators if they follow any industry safety standards and avoid those that don’t.

_Ask to see inspection or maintenance reports, and inquire about staff training.

_Always wear safety equipment provided including body harnesses, helmets and gloves.

_Don’t readjust harnesses after guides have secured them.

_Listen closely and follow guides’ instructions.

canada-press

 

Tackling the big issues with big data

By Joel Wittnebel/The Oshawa Express

It has been labeled as the biggest lie on the Internet, “I have read and agree to these terms and conditions.”

With every account users sign up for, every update to an app, or new software installed, the notification to accept the terms of a privacy agreement comes with it.

Do people read these usually lengthy and jargon filled agreements? Of course not.

However, that could change when Canadians start to realize just how much information they are giving out on a daily basis.

Dr. Jonathan Obar with the University of Ontario Institute of Technology specializes in the study of how these digital technologies impact our freedoms.

“I look at how they can empower us to promote civil liberties and I’m also interested in how they threaten civil liberties,” Obar says.

The reality is, the ever expanding world of “big data” poses newer and expanding opportunities, not all of them good, for how companies, known as data brokers,  can use your information.

Through data brokers, insurance companies can get information about your eating habits when assessing you for life insurance or perhaps police can get information on driving habits.

The data is out there, and Obar is searching for a solution.

In an interview with The Express, Obar explained his work, why big data is an increasing problem, and the search for a possible solution.

The problem

Some may ask why does this matter? Who cares if a grocery store is tracking purchases through a membership card? Some may say they’ve got nothing to hide.

“Perhaps you’re not familiar, or aware of what you might want to hide,” Obar says.

For decades, the privacy issue has used George Orwell’s narrative created in his novel 1984 as a comparator.

Simplified, the narrative is that Big Brother, or the government, is always watching and gathering information about us to use to their advantage.

However, Obar says this story is no longer relevant to the reality of the digital world today.

“Things are far more complicated now than George Orwell imagined when he was writing 1984,” Obar says.

Instead of one entity with all the information, the data is spread out in an unknown number of locations.

“If all the data was housed in one place, we would know where to look for it and if we wanted to affect change, we could target our efforts at one place, regulate that one entity,” he says. “The problem is that data is everywhere and not only that the data is everywhere, it’s being used in different ways everywhere.”

The regulations surrounding the gathering and sharing of information are shady at best with little specific requirements for how the information is gathered by companies or where it is shared, Obar says.

In a previous report, Obar and a colleague from the University of Toronto assessed 43 Canadian Internet service providers and found the majority of them tell very little about what they are doing with their customers’ information.

While this is the problem, one the Federal Trade Commission has tried to address and give “digital citizens” increased right to their information, Obar says the solution is far more complicated.

“If we all had access to the data, where would we begin?” he says. The sheer amount of data that exists about us could prove to be overwhelming.

The second problem exists in the form of how this data is used.

“All of this data is being used to generate profiles about people and how risky they are as investments,” Obar says.

For example, data brokers – companies whose sole focus is gathering information and shirking it to clients – can share your unhealthy eating habits with insurance companies.

One way of obtaining that is through the data gathered through the use of a membership card.

“The loyalty programs that these companies have are not about a dollar off milk, it’s about the data,” Obar says.

The solution

In a working paper, soon to be published in Big Data and Society, Obar says the self-management of all this data is impossible.

So Obar suggests that perhaps professionals will be created to deal with that very issue.

“Just like we hire an accountant to help interpret our financial data come tax time, perhaps eventually there will be, what I call, representative data managers,” he says.

This position would be someone who can monitor our data, check where it’s been sent, who is sending it and exactly what it’s being used for.

There’s another problem.

“The big issue is how do you generate demand for these services?” Obar says.

Aon brings innovative marine modelling to market for 1/1 reinsurance renewals

MONTE CARLO, 13 September 2015 – Aon Benfield, the global reinsurance intermediary and capital advisor of Aon plc (NYSE:AON), has invested in an innovative catastrophe model to help marine and energy insurers more accurately assess their cargo risks.

Catastrophe models are commonplace in the non-marine sector but the marine and energy insurance industry has often found it difficult to accurately manage exposures due to the non-static nature of the risks. To date, existing models have offered no differentiation by commodity type, cargo volume or storage configuration.  For example, contrasting cargo types such as rubber tyres and electronics could produce the same level of modelled losses.

Aon Benfield recognised the need for innovation and partnered with catastrophe model vendor RMS to develop a marine and energy catastrophe modelling solution. This new product is available from Aon Benfield, which has broker exclusivity, to offer insurers the ability to refine coverage and purchase more efficient reinsurance at forthcoming 1 January 2016 renewal.

The model comprises:

  • Some 85 cargo and specie vulnerability curves based on 18 commodity types – from pharmaceutical and petroleum to cars and fine art – and 12 storage options. The curves will refine damage estimations for cargo from the perils of US hurricane including surge, US earthquake, European windstorm and Asia typhoon.
  • Highly detailed industry exposure databases for major global ports, from Shanghai in China to Houston in the US. The databases take into account cargo classification, volume and time in port, based on industry data and research.

This innovative model enables marine and energy insurers and reinsurers to:

  1. More accurately assess cargo accumulations and loss potential from natural catastrophe events
  2. Improved pricing assumptions for marine risks, leading to more competitive product offerings
  3. Enhanced exposure management, accumulation control and claims reserving
  4. Increased reinsurance purchasing efficiency
  5. Standardisation of marine modelling for the whole industry including a uniform approach to storing marine data

Paul Miller, international head of Aon Benfield’s catastrophe management team, explained: “This project will drive industry standards for the modelling of marine business and help to revolutionise the way insurers manage their exposures. Aon Benfield has made a financial investment in this innovative new solution because we believe it will genuinely add value to our clients’ business and growth strategies.”

Aon Benfield’s partnership with RMS also involves future development plans including offshore energy updates, a new marine data schema and a port interconnectivity model.

About Aon

Aon plc (NYSE:AON) is a leading global provider of risk management, insurance brokerage and reinsurance brokerage, and human resources solutions and outsourcing services. Through its more than 69,000 colleagues worldwide, Aon unites to empower results for clients in over 120 countries via innovative risk and people solutions. For further information on our capabilities and to learn how we empower results for clients, please visit: http://aon.mediaroom.com/

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