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Insurers look to AI as FEMA rates rise

Aerial imagery provides one of the best options for insurance companies to stay profitable in high risk markets like flood.

By Guy Attar | October 12, 2022 at 11:15 AM
Insured losses from floods doubled to $83 million during 2011-2020 as compared to the previous decade and global flood losses reached $20 billion in 2021 alone, according to Swiss Re. (Photo: bilanol/Adobe Stock) Insured losses from floods doubled to $83 million during 2011-2020 as compared to the previous decade and global flood losses reached $20 billion in 2021 alone, according to Swiss Re. (Photo: bilanol/Adobe Stock)

Billions of people worldwide face flood risk, and this number is steadily increasing with the effects of climate change. Consider that more than a third of Pakistan was underwater this summer as a result of intense rainfall. Although that extent of flooding has not yet been experienced in the United States, it certainly indicates a concerning trend. With global warming resulting in severe drought in some places and heavy rainstorms in others, U.S. infrastructure is having to withstand higher volumes of water in a shorter period of time. Drought can also accentuate the effects of flooding through reducing the permeability of ground, causing water to remain on the surface. With flood defenses overwhelmed, many U.S. states are seeing a rise in flooding.

Other manmade trends such as increased urbanization are also having a concerning impact on the rate of flooding, with vast amounts of concrete being used for roads, parking lots and developments. This has led to a rapid reduction in the total permeable surface area, putting drainage infrastructure under significant strain.

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