Storm consultancy

Whilst UK insurers receive on average 500,000 claims for damage attributed to ‘storm’ each year, no common industry definition exists for the peril.

Criteria employed are often subjective, have little rational basis and differ wildly between insurers. The result is:

• Subjective processes
• Excessive leakage
• Opportunity for fraud and inflation
• Confusion amongst customers
• Poor industry PR

Customers receive an inconsistent service that depends upon the identity of their insurer, and many claims are paid where windstorm is unlikely to have been the cause.

Insurers rightly need to treat their customers fairly, but can still dramatically reduce their exposure to storm, contain losses and act more decisively by tightening peril definitions and employing more rigorous process.

Our survey revealed that some insurers deemed gusts of 38mph as sufficient to evidence windstorm, whilst others required gusts of at least 55mph. There was a similar lack of consensus in the latitude granted for customers to frame the loss date, and their attitude towards late notifications.

Our work culminated in a set of tables that enable insurers to benchmark the standards they employ against their peers and competitors and also to quantify the effect of adopting new rules on their annual storm claim exposure and spend.

Key benefits

• Greater understanding of the 25% of all losses typically attributed to storm
• Reduced exposure and spend from tightening peril definitions (allied to more rigorous process)
• Greater transparency and a focus on Treating Customers Fairly
• Helps establish an insurer’s position in the market

Key features

• Describes the various definitions for storm employed across the industry
• Quantifies the effect of implementing new peril definitions on typical annual storm claim exposure and spend
• Makes recommendations and frames precedents
• Provides a route map to ideal process, and best practice
• Provides ongoing analysis and audit measuring the effect of any changes implemented

For further information about our service, please contact Steve Roberts on
+44 1202 296396 or email steve@weathernet.co.uk or visit our website at weathernet.co.uk