Corporate risk managers can reduce exposure to additional
financial losses if another flood occurs
PHILADELPHIA--(BUSINESS WIRE)--
ACE USA, the U.S.-based retail operations of the ACE Group, today
announced the release of a white paper exploring innovations in flood
insurance protection brought to market since Superstorm Sandy made
landfall in October, 2012. The new white paper, “Innovations in Flood
Insurance Protection,” discusses the introduction of flood reinstatement
coverage, which provides excess of loss insurance above the remaining
limits of protection in the underlying property insurance policy.
Following the catastrophic losses of Superstorm Sandy, many businesses
were unable to obtain additional coverage, or were forced to reinstate
limits of existing policies at much higher cost, stricter coverage terms
or substantial increases in deductibles. Since Superstorm Sandy, massive
flooding has also devastated the cities of Calgary and Toronto in
Canada, as well as Boulder, Colorado.
“In the aftermath of Superstorm Sandy, many corporate risk managers
whose organizations had experienced a flood loss found their companies
facing a new exposure — because the financial limits of their existing
insurance policies were exhausted, they were responsible for additional
financial losses in the event of another flood,” said Jeremiah Konz,
Senior Vice President, ACE North American Property & Specialty Lines,
and author of the new ACE white paper. “With flood reinstatement
coverage now available, risk managers unable to acquire their customary
policy limits at renewal have the option to buy coverage to build back
or build additional high hazard flood limit for improved protection.”
Risk managers now have the option to buy additional standalone flood
insurance if the current coverage is renewed with decreased limits or
sub-limits, or if the high-hazard flood deductible in the primary
program has dramatically increased. In effect, the insurance augments
the limits remaining in the insured’s property insurance policy, even in
cases where the limits have been completely exhausted. The coverage
terms, conditions and premium charged are based on each insured’s
high-hazard flooding exposures. Additionally, in cases where a company
building may be financed through a bank, inadequate insurance coverage
can reduce the chances of obtaining favorable loan terms, if not
eliminate it in its entirety. Flood limit reinstatement insurance
provides an additional layer of financial protection to prevent this.
To access the paper, please visit
our website. The material presented in this report is not intended
to provide legal or other expert advice. It is presented as
informational only. Readers should consult legal counsel or other
technical experts, as applicable, with any specific questions they may
have.
ACE’s Specialty Catastrophe Unit seeks to understand and define client
challenges to provide customized solutions that specifically address
these needs. It is highly regarded for its creative responses to
complicated market conditions, providing named storm deductible
buydowns, offering multi-year insurance arrangements, and developing
parametric triggered coverage for concentrated catastrophe exposures, in
addition to the flood limit reinstatement policy.
ACE’s Property & Specialty Lines Division offers comprehensive
management solutions for the property, marine, inland marine, energy and
aviation insurance needs of U.S.-based companies, ranging from mid-size
domestic to large multinational, as well as provide customized
fee-for-service engineering consulting for long-term client loss control
solutions. For more information about our range of products and
services, please visit
our website.
ACE USA is the U.S.-based retail operating division of the ACE Group,
headed by ACE Limited, and is rated A+ (Superior) by A.M. Best Company
and A+ (Strong) by Standard & Poor’s. ACE USA, through its underwriting
companies, provides insurance products and services throughout the U.S.
Additional information on ACE USA and its products and services can be
found at www.acegroup.com/us.
The ACE Group is one of the world’s largest multiline property and
casualty insurers. With operations in 53 countries, ACE provides
commercial and personal property and casualty insurance, personal
accident supplemental health insurance, reinsurance, and life insurance
to a diverse group of clients. ACE Limited, the parent company of the
ACE Group, is listed on the New York Stock Exchange (NYSE: ACE) and is a
component of the S&P 500 index. Additional information can be found at: www.acegroup.com.
Source: The ACE Group