CoreLogic Launches Risk Analytics for Sewer Backup
March 04, 2015, Irvine, Calif. –
––Proprietary Sewer Backup Risk Score To Help Insurers Improve Underwriting—
CoreLogic® (NYSE: CLGX), a leading global property information, analytics and data-enabled services provider, today announced the launch of Sewer Backup Risk Score, a new data-based assessment that identifies the potential risk of sewer backup and basement flooding with unique location-specific analysis. The proprietary sewer backup and basement flood risk score can be integrated into insurance underwriting processes to aid understanding of risk potential based on a set of comprehensive scientific factors including watershed hydrology, rainfall intensity and frequency, soil hydro properties, tree coverage, land depression, aging sewer systems at the structures and in the communities, combined sewer areas, land slope, elevation variances between properties and potential flood sources, and sewer system patterns.
Sewer Backup Risk Score provides both a numeric (1-100) and categorical risk rating (ranging from Very Low to Extreme) that enables insurance underwriters to set guidelines for writing sewer backup and excess flood endorsements, establish appropriate premiums and evaluate potential portfolio exposure. The extent of potential risk is determined using a number of CoreLogic geospatial datasets, including Flood Risk Score, Flash Flood Risk Score, hydrology information, property data, neighborhood data and land depression layers, as well as other scientific datasets from the U.S. Geological Survey, the U.S. Department of Agriculture and commercial data providers, to evaluate sewer conditions and risk intersections along sewer lines.
“CoreLogic is on the forefront of helping insurers and property owners identify risk associated with flood-related events,” said Lindene Patton, global head of hazard product development for CoreLogic Spatial Solutions. “The marketplace was in need and requested a better means of assessing this specific type of risk, and Sewer Backup Risk Score fills that void. By accessing the power of CoreLogic natural hazard datasets, we are able to accurately identify potential risk for surface flooding, which is a primary contributor to sewer backup and basement flooding.”
According to the Association of California Water Agencies, sewer backup claims are estimated at more than 500,000 annually, with average claims rising 3 percent every year according to the Insurance Information Institute. Research from the Insurance Information Institute also shows that sewer backup coverage is relatively inexpensive to purchase, ranging from annual premiums of $40-$160, while the average claim can easily be $25,000 or more. Prior to writing an endorsement for sewer backup or excess flood, insurers need the ability to assess the potential risk for a future claim. They must also be able to decide whether to offer an endorsement and to ensure that the proposed premium is in line with the risk assessment.
“As average sewer backup claims continue to rise, insurance companies have to be able to better evaluate potential risk for this type of endorsement,” said Patton. “Their underwriting decisions must be good risks for their books of business. With access to these data-driven insights, they are empowered to make smarter decisions and can even pass along advice to their customers on how to mitigate against the risk.”
Sewer Backup Risk Score can be integrated into other CoreLogic hazard products, allowing insurers to assess portfolio risk and reduce the number of claims for hazard events by avoiding underwriting properties with higher risk scores.
CoreLogic (NYSE: CLGX) is a leading global property information, analytics and data-enabled services provider. The company’s combined data from public, contributory and proprietary sources includes over 3.5 billion records spanning more than 40 years, providing detailed coverage of property, mortgages and other encumbrances, consumer credit, tenancy, location, hazard risk and related performance information. The markets CoreLogic serves include real estate and mortgage finance, insurance, capital markets, and the public sector. CoreLogic delivers value to clients through unique data, analytics, workflow technology, advisory and managed services. Clients rely on CoreLogic to help identify and manage growth opportunities, improve performance and mitigate risk. Headquartered in Irvine, Calif., CoreLogic operates in North America, Western Europe and Asia Pacific. For more information, please visit www.corelogic.com.
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