While not wholly unpredictable, catastrophes more often than not catch us off guard, which makes preparing for reparations an exceedingly difficult task.
Meteorologists had been warning for decades that a catastrophic weather system on the scale of Hurricane Katrina was not just a possibility but an inevitability prior to 2005. Yet it wasn’t until hours before the storm entered the Gulf of Mexico that residents of the region and weather experts realized that “the big one” had hit.
The same is true for Hurricane Sandy, which pummeled the Northeastern United States in 2012. It left the most populous corridor of the country in shambles following the incident, which seemed more like a scenario fit for the big screen than for reality.
While these events certainly caught the country off guard – and unprecedented weather events of this magnitude seem to be occurring with increased regularity the world over – they aren’t entirely unpredictable or unquantifiable phenomena.
As residents of the Gulf and the Northeast can attest following Katrina and Sandy, respectively, forecasting for these scenarios is going to be very important for not just individuals looking to reside in at-risk communities, but also the businesses that insure their property.
Taking The Human Element Into Consideration
When it comes to insuring automobiles, there is a lot more than weather that comes into consideration for risk assessment, which location intelligence can help inform. For instance, local crime rates or even accident patterns will heavily dictate the cost of owning a vehicle in certain neighborhoods or regions, as well as historical travel patterns that may reveal an unavoidable traffic risk in the owner’s daily commute.
Rather than sitting idly by and doling out funds when the unexpected hits, insurance companies are able to proactively determine the probability of such events. The foundation of this research lies in location intelligence.
While geocoding is the location information attached to a record, geoenrichment enhances customer data with a wide range of relevant information that goes beyond just climatological factors and into other risk areas related to an individual or property. For auto insurers, for instance, by analyzing large volumes of historical travel data coupled with historical accident and crime observations, as well as present observations, insurers can assign estimated risk and associated premiums to specific plans.
The Data Is There – It Just Needs to be Put to Use
Roughly 80 percent of all business data already contains geocoding or some other location component. Geoenrichment removes the complexity from the traditional process of spatially-enabling this data, allowing organizations to quickly and easily unlock the value of its location data to reduce risk, save operational cost and grow their businesses. This information empowers insurers to make highly accurate, comprehensive risk profiles for properties all over the world.
The consortium of information that goes into the latest geoenrichment technology reaches far beyond historical weather patterns, but also business history related to a certain property: What is the current book of business in play at a specific location, and how may that place a premium on insurance?
Embracing location intelligence in this respect by turning toward geoenrichment also helps insurers model the impact of catastrophic events in real time, allowing them to better allocate resources where they are needed most, and forecast for any short-term risk exposure a property may be exposed to following the event.
Learn more about location intelligence, geoenrichment and how these technologies can more accurately help businesses map out insurance plans.