PressNewsCommitmentEnvironment: How AGCS monitors and models Harvey losses and supports its customers

Hurricane Harvey Loss Event Taskforce

How AGCS monitors and models Harvey losses and supports its customers

Service & Contacts

Allianz Group Communications
Koeniginstr. 28
80802 Munich
Germany

Contact overview

Receive the latest Allianz news.

Newsletter

Follow Allianz in the social networks:

Facebook
Twitter
Google+
LinkedIn

  • Contact

  • Newsletter

  • Social Media

What direction is the storm taking? Has the highest water level already been reached or are waters still rising? Which companies have already reported damages? Since Hurricane Harvey has directly impacted the important American economic region around Houston, Texas, the Loss Event Task Force of Allianz’s global industrial insurer Allianz Global Corporate & Specialty (AGCS) has been meeting daily in Munich.

Allianz SE
Munich, Sep 04, 2017

At the table are damage assessors, engineers, climate researchers, reinsurance specialists and financial controllers from the Munich headquarters of AGCS. Experts from the New York and Chicago are also connected via telephone conference as well as a loss adjuster from AGCS' Houston office who is dialing in remotely from his home. The global team discusses prospective storm routes and flooded areas, updates each other and gathers an overview about which AGCS customers could potentially suffer losses from wind damage or torrential rain.

Allianz-Joerg Ahrens, Global Head of Key Case Management, AGCS

Joerg Ahrens, Global Head of Key Case Management, AGCS

Of course, with modern modeling tools for natural catastrophes and advanced big data analysis, potential loss scenarios for Harvey could easily be developed. But these would change almost hourly and the range of forecast scenarios would be broad. It is currently impossible to assess the damage. Many neighborhoods of the greater Houston have been still underwater over the last weekend. The water levels are expected to recede in the course of this week. However, in some areas it may take one or even two weeks until the water will have completely disappeared. Travel to the damaged areas is difficult to impossible due to road closures, lack of gas in the area and the devastation that has occurred.
  

"It is pure speculation to make any statements about possible claims impact or overall losses at this stage," says Joerg Ahrens, Global Head of Key Case Management, and is responsible for managing large claims at AGCS. A few dozen customers have reported damage as a precautionary measure, mostly port facilities or oil processing companies. But the true extent of the destruction is still unknown, even among early claimants.

 

"Most affected companies currently only know that their land or buildings are submerged, but not even their own employees have access to the company for security reasons," says Steve Kennedy, Regional Head of Property, Energy and Engineering Claims for North America. The AGCS office in Houston is closed and is not expected to reopen until Tuesday.
  

In the coming days and weeks, affected companies, together with Allianz loss adjusters, will get a first impression of the actual damage. During inspections they can investigate whether and to what extent harbor infrastructure, industrial facilities, office buildings or shopping centers have been damaged by the storm's excessive water. Whether machines can be repaired or declared as totally damaged is a comparatively simple decision. It is much more difficult – and naturally also more challenging -- for companies to determine the losses that will be caused by business or supply chain interruption over the next few weeks or even months. Such interruption can quickly reach millions of dollars and exceed the actual material damage by multiple factors.

 

"We actively support and advise our customers before, during and after the storm to limit the damage and to help them return to normal operation as quickly as possible," emphasizes Ahrens. "We will also make every effort to provide quick coverage commitments and issue first advance payments wherever possible.” 

 

While the tragic scale of the impact on the residents and neighborhoods in Harvey’s path is obvious, the overall commercial effects of the hurricane cannot yet be judged. Comparisons with previous natural catastrophes such as Superstorm Sandy, whose storm surges hit the northeast coast of the United States in October 2012 and which caused AGCS 900 claims and cost the insurance industry USD 29.5 billion, or 2001’s comparatively moderate tropical storm Allison which was also accompanied by massive rainfall have little validity at this stage.

 

"Time will tell," said Ali Shahkarami, who is responsible for catastrophe risk research at AGCS. Each hurricane has its own course and its peculiar features such as gale winds, storm floods or heavy rain falls. "Even if hurricanes are somewhat announced natural disasters, each of them is good for surprises." Besides Harvey there are other tropical storms which he has started monitoring. Over the next few days, “Irma”, which has strengthened to a category 5 storm, is expected to make landfall that the US coast. “This hurricane season may turn out to be an active one after all, matching predictions.”

  Forward Looking Statement disclaimer

As with all content published on this site, these statements are subject to our Forward Looking Statement disclaimer:

 

  Press contact

Sabrina Glavan
Allianz Global Corporate & Specialty
Phone: +1 646 472 1510

Send email

Heidi Polke-Markmann
Allianz Global Corporate & Specialty SE
Phone: +49.89.3800-14303

Send email

Sandra Matl
Allianz SE
Phone: +49 89 3800 69144

Send email

  More at allianz.com

Beware of generation generalizations

Allianz-Beware of generation generalizations
Nov 20, 2017 | Allianz SE

Shortly before the stroke of midnight on December 31, the last-born millennial will turn 18 – marking a generational milestone...

More...

Allianz study: millennials optimistic despite gloomy expectations

Allianz-Allianz expands footprint in China with new Beijing branch
Nov 20, 2017 | Allianz SE

Millennials believe the world is more difficult and complex than their parents faced at the same age and are gloomy about the career prospects of their generation. They expect artificial intelligence and robotics to disrupt the workplace, and that employment insecurity and pressure in the workplace to perform will increase. 

More...

Allianz reports 2.5 billion euros operating profit in 3Q 2017; on track for full-year target

Allianz-Allianz reports 2.5 billion euros operating profit in 3Q 2017; on track for full-year target
Nov 09, 2017 | Allianz SE

Allianz Group reported good results for the third quarter of 2017 after a series of hurricanes, storms and other natural catastrophes drove claims higher. Total revenues rose 2.1 percent compared to the third quarter of 2016 to 28.3 (third quarter of 2016: 27.7) billion euros, mostly due to another strong performance in the Life and Health business segment. Operating profit declined to 2.5 (3.0) billion euros, largely due to 529 million euros losses from natural catastrophes. 

More...
More...