Flood risk analytics: Ambiental & WhenFresh on data & cover

Mark Cunningham, CEO of WhenFresh and Rob Carling from Ambiental tell us about their latest collaboration and its effect on insurance flood risk analytics

InsurTechs Ambiental and WhenFresh have extended their partnership to include flood specialist Ambiental's FloodScore™ Climate data.

This move will enable more insurers and banks to meet both current and future commercial needs and their Bank of England regulatory obligations via WhenFresh's data supermarket, which is used by eight of the UK's 10 top Banks, leading UK Home Insurers and the Bank of England.

We spoke to Mark Cunningham, CEO of WhenFresh, and Rob Carling, Channel Sales Manager at Ambiental about this latest collaboration that looks set to transform the flood insurance market.

The environmental risk technology space is rapidly expanding. Can you tell us a bit more about Ambiental’s FloodScore Climate and its capabilities?

Rob Carling: Flood Score Climate’s database covers the United Kingdom and provides property-level flood risk scores and information for residential and commercial mortgage lenders, insurers, and other users. The product is highly customisable and is delivered to a database whereby the flood data is extracted to each address. 

The data covers current and future flood risks for three-time epochs (2020, the 2050s, and 2080s) and under four RCP scenarios (2.6, 4.5, 6.0, and 8.5).

Mark Cunningham: This Ambiental FloodScore Climate dataset is the result of a huge body of work and is a very welcome recent addition to the hundreds of best-in-class proprietary, private, and public datasets that we’ve brought together in one place to form what we call the ‘Residential Property Data Supermarket’.

The end result is that this highly granular flood and climate data is now available alongside all the risk, peril, environmental, geospatial, market, valuations, and property attribute data that insurers and lenders need, via a single, simple API integration, in real-time, where needed.

How valuable is the data in the long term and what does WhenFresh bring to the table?

Rob Carling: Flooding is an increasingly real risk in the UK and globally, posing a significant threat to infrastructure, people, and investments. In fact, six of the wettest years in history have occurred since 1998 and flooding is now considered the greatest natural disaster risk in the UK as one in six properties in England and Wales are at risk. By 2050, it is likely that another one million properties in the UK will be at risk of flooding so the UK will increasingly feel the effects of climate change in the next few decades.

WhenFresh provides the technology interface for insurers, mortgage lenders, and other financial companies to easily access and consume the data. Insurers may conclude that future flood risk is not relevant for their business model because of the high policy churn rate, particularly in the residential sector. However, even larger insurers will have a percentage of their portfolio that does not churn, and in many cases, policies could be on their books for ten to twenty years. Indeed, future flood risk could be a real problem for some specialists, e.g. high net worth or insurers who focus on a particular segment where the churn rate is relatively low. So we would challenge all insurers to take a look and assess the future flood risk; otherwise, it could be costly to ignore.

Mark Cunningham: The insurers, lenders, and other parties who need to understand the environmental risk for commercial and/or regulatory reasons all operate in different ways, but they very rarely look at just one dataset in isolation. Any given insurer will have their own ‘risk recipe’ and WhenFresh is able to provide all the other ‘data ingredients’ they each need to complement the flood and climate data and reach their desired conclusions.

How big is the demand for this type of data?

Rob Carling: Demand for high-resolution climate data at the property level is growing fast, particularly from the mortgage lenders who comply with the Bank of England Stress Tests on Climate Change. The recent Cop26 conference has helped raise awareness of the impacts of climate change, and we expect interest in this type of data to increase significantly over the next 12 months. 

Mark Cunningham: It’s big! Better, more specialised environmental and climate datasets continue to become available, so there is a commercial imperative for every mortgage lender or home insurer to continuously improve their understanding of risk, or they will surely fall behind their competitors. Plus, there are ever-increasing regulatory obligations to fulfill.

How will this new partnership potentially affect the little man as opposed to the commercial operatives?

Rob Carling: Ambiental Flood Score Climate data is flexible and is used by lenders and insurers with portfolios from a few thousand up into the millions. Our clients range from industry giants such as Zurich, to Azur and Flood Re amongst others.

Mark Cunningham: The WhenFresh ‘Data Supermarket’ allows users to select exactly the data they need on a Pay-As-You-Go basis, without having to deal with multiple companies who supply data in disparate formats, with sometimes onerous data licensing conditions. It has been specifically designed so that data is equally accessible to the smallest of start-ups and the biggest household name institutions.

WhenFresh data is used both by the ‘household names’ - including 8 of the top 10 UK banks, many leading insurers, the Bank of England and the public sector – and by the younger, more agile, and disruptive Insurers and Lenders such as Uinsure and Locket (formerly Hiro Insurance) and Twenty7Tec, who tend to be more able to integrate and start using data from the WhenFresh API the fastest. That said, we got one major home Insurer set up and taking data in about 30 minutes recently!  

Recently, Ambiental ran a blog on climate change and floods in western Europe. How can the information gathered assist in the climate change strategy?

Rob Carling: In addition to the UK, FloodScore Climate covers ten European countries, including France, Germany, Spain, and Italy. Earlier this year, the devastating floods in Germany demonstrated the impact on properties and potential loss of life from more frequent extreme weather events across Europe and the Globe. We are already working with several financial institutions that use our data across several European countries.

Currently, WhenFresh is concentrated on UK providers. Are there any plans to extend this further afield, to emerging markets?

Mark Cunningham: We have had initial looks at other markets and, as a distributed company, we have people on the ground in the US and mainland Europe. However, for the time being, WhenFresh remains laser-focused on the UK and there is plenty to keep us busy here for now!

What changes to this space do you forecast happening over the next decade?

Mark Cunningham: Over the last 10 years, there have been huge advancements in the range and quality of data available about flood risk, climate change, location, the height of trees, soil types, air quality, noise pollution, subsidence, and even the risk posed by the presence of Japanese Knotweed at a property… and there seems nothing to suggest the pace of change is slowing down.  

What can we expect going forward from Ambiental and WhenFresh?

Rob Carling: We expect the appetite and usage of this type of data to increase massively in the future. We want to encourage sub-groups within the financial sector such as insurers, REITs, and pension funds to test climate change data and assess the future risk of flooding.
Mark Cunningham: With this Ambiental FloodScore Climate data now available via the Data Supermarket, we expect to help increase the understanding and usage of flood data both for existing book risk analysis and originations among UK insurers and lenders – and we will continue to add further high quality environmental and climate datasets at pace. 


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