risk on the rise: managing inland flood risk
TRANSCRIPT
1 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
RISK ON THE RISE: MANAGING INLAND FLOOD RISK Dr. Christine Ziehmann Model Product Management
Dr. Arno Hilberts Model Development
Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
2 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
MEET THE EXPERTS
Dr. Christine Ziehmann Vice President,
Model Product Management
Dr. Arno Hilberts Senior Director,
Model Development
3 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
HOW DO YOU DEFINE INLAND FLOOD?
Surface Water Flooding 2012 UK Flood Sequence
Riverine Flooding 2013 Central Europe
US$1.8 B
486 K CLAIMS US$4.2 B
7 COUNTRIES
4 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
HOW DO YOU DEFINE INLAND FLOOD?
Flash Flooding 2014 Midwest Flash Flood, USA
US$1.8 B
75 K IMPACTED
Second-highest 24-hour rainfall Detroit, MI USA 2014
116 mm
5 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
US$9 B 41 FATALITIES
HOW DO YOU DEFINE INLAND FLOOD?
Tropical Storm-Induced Flooding Tropical Storm Allison, Houston TX USA
~ week
~1,000 mm
6 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
>US$45 B >6 MONTHS IN PLACES
HOW DO YOU DEFINE INLAND FLOOD?
Monsoon Flooding 2011 Thailand Foods
>13 M AFFECTED
815 FATALITIES
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MANY WAYS TO THINK ABOUT INLAND FLOOD…
>US$45 B Economic Loss
~33% Insured
~US$9 B Economic Loss
~55% Insured
~US$1.8 B Economic Loss
~28% Insured
>US$2.5 B Economic Loss
~60% Insured
~US$16.8 B Economic Loss
~25% Insured
The cost to the industry varies considerably
8 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
DIFFERENCES IN GLOBAL FLOOD RISK MANAGEMENT
HAZARD POOLS
HIGH COVERAGE
LOW COVERAGE
NFIP
Flood Re
NCIF
50 - 60%
40 - 70%
up to 75%
BR, EC, MX
CN, PH, TW
AT, DE, IT, TR
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PAST CHALLENGES TO PROFITABILITY
§ US GOVERNMENT POOL CASE STUDY: NFIP
– Run at a loss four out of past 10 years
– 2005: losses were 900% of premium
– Peak losses were coastal, but inland has attritional impact
§ INSURANCE INDUSTRY CASE STUDY: U.K.
– Significant loss history: 2013-14, 2012, 2007, 2005, 2000, and more
– Insurance industry almost pulled out
– Government and industry agreement on Flood Re as preferred solution
10 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
PAST CHALLENGES FOR INLAND FLOOD RISK
Characteristics that have not been well understood:
FREQUENCY SEVERITY CHANGING ENVIRONMENT
SPATIAL EXTENT
SPATIAL VARIABILITY
WATER DEPTH
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EVENT CHARACTERISTICS VARY SIGNIFICANTLY: FREQUENCY OF SEVERE EVENTS
ANNUAL
ANNUAL
DECADAL
DECADAL >ANNUAL
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~WEEKS
~HOURS TO DAYS
~DAYS
~DAYS TO WEEKS ~HOURS
EVENT CHARACTERISTICS VARY SIGNIFICANTLY: PRECIPITATION DURATION
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EVENT CHARACTERISTICS VARY SIGNIFICANTLY: AREA IMPACTED
COUNTRY
REGION
CITY
CONTINENT CITY
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INDUSTRIAL DEVELOPMENT
LAND USE
CLIMATE
DEFENSES DRAINAGE
EVENT CHARACTERISTICS VARY SIGNIFICANTLY: CHANGES IN RISK
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UNDERSTANDING THIS COMPLEX PERIL
Where does it all begin?
PRECIPITATION
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UNDERSTANDING PRECIPITATION IS THE FOUNDATION TO UNDERSTANDING INLAND FLOOD RISK
PRECIPITATION FREQUENCY: TIMELINE OF
EVENTS
SEVERITY: INTENSITY OF
EVENTS
EXTENT: SPATIAL
CORRELATION
ENVIRONMENT: ANTECEDENT CONDITIONS
17 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
DEVELOPING A FRAMEWORK TO UNDERSTAND AND MODEL INLAND FLOOD RISK
RISK VULNERABILITY HAZARD
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Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage
DEVELOPING A FRAMEWORK TO UNDERSTAND AND MODEL INLAND FLOOD RISK
Precipitation
PRECIPITATION
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DEVELOPING A FRAMEWORK: WHY BEGIN WITH PRECIPITATION?
Time
Riv
er F
low
Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage Precipitation
FREQUENCY: TIMELINE OF
EVENTS
20 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
DEVELOPING A FRAMEWORK: WHY BEGIN WITH PRECIPITATION?
Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage Precipitation
SEVERITY: INTENSITY OF
EVENTS
21 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
DEVELOPING A FRAMEWORK: WHY BEGIN WITH PRECIPITATION?
Correlation of monthly peak flows in Vienna (Danube) and Dresden (Elbe)
Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage Precipitation
EXTENT: SPATIAL
CORRELATION
22 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
DEVELOPING A FRAMEWORK: WHY BEGIN WITH PRECIPITATION?
How severe would the flooding be if the antecedent conditions of 2013 were combined with the extreme event precipitation observed in 2002?
Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage Precipitation
2013 Wetness
ENVIRONMENT: ANTECEDENT CONDITIONS
23 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
HYDROLOGICAL PROCESSES
DEVELOPING A FRAMEWORK: WHERE DOES THE PRECIPITATION GO?
§ High resolution; 40-50 m
§ Less than daily time steps
§ Continuously for 103 years
Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage Precipitation
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HIGH RESOLUTION
≠ HIGH ACCURACY
DEVELOPING A FRAMEWORK: WHERE DOES THE PRECIPITATION GO?
50 m DTM, ground-truthed
5 m DTM, LIDAR
Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage Precipitation
25 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
COMPLETE NETWORK
DEVELOPING A FRAMEWORK: WHERE CAN FLOODING OCCUR?
Major vs. minor
Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage Precipitation
26 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
COMPLETE NETWORK
DEVELOPING A FRAMEWORK: WHERE CAN FLOODING OCCUR?
Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage Precipitation
Extensive river network defined
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COMPLETE NETWORK
DEVELOPING A FRAMEWORK: WHERE CAN FLOODING OCCUR?
Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage Precipitation
Extensive river gauge data
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DRAINAGE
DEVELOPING A FRAMEWORK: FACTORS THAT CAN INFLUENCE FLOOD SEVERITY
Understand current design standards…
and be aware of developing environments
Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage Precipitation
29 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
DEFENSES
DEVELOPING A FRAMEWORK: FACTORS THAT CAN INFLUENCE FLOOD SEVERITY
Must consider for temporary and permanent defenses
Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage Precipitation
30 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
DEFENSES
DEVELOPING A FRAMEWORK: FACTORS THAT CAN INFLUENCE FLOOD SEVERITY
What about defense failure?
Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage Precipitation
31 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
DEVELOPING A FRAMEWORK: UNDERSTANDING THE EXTENT OF POTENTIAL FLOODING
EUROPE SOUTH KOREA USA
Inundation Rainfall runoff
Major and minor rivers
Defenses and
drainage Precipitation
32 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
CONCLUSIONS
Historically, inland flood risk has been a challenge to manage
FREQUENCY SEVERITY CHANGING ENVIRONMENT
SPATIAL EXTENT
SPATIAL VARIABILITY
WATER DEPTH
33 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
CONCLUSIONS
Today we have the knowledge and tools to explicitly model and understand the risk from its source
FREQUENCY: Timeline of events
ENVIRONMENT: Antecedent conditions
SEVERITY: Intensity of events
EXTENT: Spatial correlation
PRECIPITATION
A comprehensive modeling approach is the only way to truly understand inland flood risk
34 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015 Copyright © 2015 Risk Management Solutions, Inc. .
INLAND FLOOD IS A
COMPLEX AND VARIED PERIL WE NOW HAVE THE TOOLS TO
UNDERSTAND AND MANAGE THE RISK
ABOUT RMS RMS is the world’s leading provider of products, services, and expertise for the quantification and management of catastrophe risk. More than 400 leading insurers, reinsurers, trading companies, and other financial institutions rely on RMS models to quantify, manage, and transfer risk. As an established provider of risk modeling to companies across all market segments, RMS provides solutions that can be trusted as reliable benchmarks for strategic pricing, risk management, and risk transfer decisions.
©2015 Risk Management Solutions, Inc. RMS and the RMS logo are registered trademarks of Risk Management Solutions, Inc. All other trademarks are property of their respective owners.
35 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015
ABOUT RMS RMS is the world’s leading provider of products, services, and expertise for the quantification and management of catastrophe risk. More than 400 leading insurers, reinsurers, trading companies, and other financial institutions rely on RMS models to quantify, manage, and transfer risk. As an established provider of risk modeling to companies across all market segments, RMS provides solutions that can be trusted as reliable benchmarks for strategic pricing, risk management, and risk transfer decisions.
35 Copyright © 2015 Risk Management Solutions, Inc. All Rights Reserved. October 13, 2015