The 2013 Calgary floods were the costliest in Canadian history, with overall damages estimated at $5 billion and insurable damages estimated at $1.7 billion. Massive amounts of rain, unexpected wind patterns, and two weather systems converged to create floods that affected 75,000 people, requiring the largest evacuation order in the city's history. As flooding began, Canadian insurers scrambled to find policyholders who were in need of assistance and assess their exposures.
This case study describes how some customers used technology to gain the insights needed to proactively respond to the catastrophe. Guidewire Live Claim Canvas is a cloud-based analytics application that enables claims management and catastrophe response teams to view portfolio exposure in the context of other internal and external data.
Getting help to those who needed it most
A typical first step in preparing a catastrophe response is to accurately identify policyholders who have flood coverage in flood evacuation zones. However, it can be difficult to obtain a timely and accurate list using traditional reporting methods. For example, using a list of affected zip codes to identify impacted policyholders is inaccurate because post codes can span large distances and floods don't respect their boundaries.
Within an hour of the start of the Calgary floods, insurers were able to use Claim Canvas to visualize flood evacuation zones and relevant policies on a map. This allowed them to easily triage and contact the hardest hit policyholders and start providing assistance when it was most needed (e.g., pre-booking a hotel room). In addition, insurers were able to determine the location and better forecast the number of adjusters needed in affected areas based on the number of anticipated claims.
Streamline the claims process
In the aftermath of the Calgary floods, claims management teams were inundated. While quick response to catastrophe-related claims was vital to getting customers back on their feet, this was easier said than done. How could a claims team reliably expedite genuine catastrophe-related claims while flagging claimants who may be trying to take advantage of the tragedy?
By visualizing claims on a map along with flood evacuation zones, insurers easily identified which claims were in the flood zone and which ones were not. This allowed them to prioritize genuine claims while flagging those that were out of the flood zone for further investigation.
Accurately tag claims for reinsurance
Considering the magnitude of claims, reinsurance teams had to ensure that claims associated with the catastrophe were properly tagged so that opportunities were not lost. One customer estimated that without geo-visualization they had miscoded about $12.5 million worth of claims. At the same time, reinsurers wanted to make sure they only paid for claims in the designated flood zones.
Reinsurance teams utilized Claim Canvas to overlay flood zones as defined by the reinsurer on a map. When this flood data layer was visually compared with claims from the Calgary floods, it was easy to see which claims were inside and outside of the flood zones. As a result, both insurer and reinsurer were confident that claims were properly coded.
The instant insights gained from geo-visualization and portfolio exposure allowed for improved quality and efficiency in response to the 2013 Calgary floods. Insurers were able to be more proactive and provide faster service to their policyholdersm while realizing cost savings through efficient allocation of scarce field resources and identification of reinsurance opportunities.
Amit Shah is the product marketing manager for Guidewire Live. He can be reached at [email protected].
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