Using Geo Data To Protect Vintage Cars From The Next Hurricane Sandy

When Hurricane Sandy began moving north toward New Jersey and New York in October of 2012, some American Modern Insurance Group policyholders in the path of the storm began taking steps to protect their collector cars.

”Some of our customers either drove their esri Collector Cars Using Geo Data To Protect Vintage Cars From The Next Hurricane Sandyvehicle to a location they thought was safe, or they jacked up their vehicles to prevent damage from storm surge,” said Christine Kaaz, head of portfolio management for the insurer. A subsidiary of Munich Re, American Modern serves customers who don’t fit a regular policy, including owners of mobile or seasonal homes, collector cars, motorcycles, boats, personal watercraft, ATVs and snowmobiles.

“We learned a lot from Sandy,” she said. “The hurricane was more violent than people expected. A lot of the vehicles that were driven inland still got hit by flood waters as they were not driven far enough away. Some got stolen because they were parked in an area safe from floods but not safe from thieves. And jacking up cars did not help in most cases as the storm surge reached enormous heights.”

In her role, Kaaz is responsible for raising emergency preparedness and the portfolio’s resilience against natural and man-made catastrophes.

The company is using geographic information systems (GIS) like Esri and taking advantage of the speed digitization offers to act faster in the face of severe weather.

Kaaz said digitization allows the company to relate the real world to the digital world. “In order to protect the customer best, insurance companies need to be able to visualize their customer’s property online,” she said. “With the GIS-based analyses, American Modern can improve its reaction time in the face of an approaching catastrophe and give our customers a better chance of getting their movable property out of the way of an approaching hurricane.”

Economic and insured losses from weather-related catastrophes have been increasing dramatically over the past 30 years, according to Kaaz. “We expect more frequent and more severe weather patterns throughout the U.S.,” she said.

The company wants to combine customer information and the locations of their cars with sophisticated maps showing the projected hurricane path and intensity while a storm is developing to help provide haul away services for customers or offer them directions to a safe location with sufficient storage capacity for their cars.

“Drawing a line between safe areas and non-safe areas helps us see how many customers are covered, and how much capacity for storage we need, and how to get customers from one side of the line to the other,” Kaaz said. “GIS allows us to develop an emergency plan for our customers.”

The company also works on emergency preparedness for mobile home owners to help them protect their property against high winds.  Mobile homes are a very popular form of housing and American Modern is a leader in insuring these homes and works with the Insurance Institute for Business & Home Safety (IBHS), to study how they react in strong winds. IBHS is an independent, nonprofit, scientific research and communications organization supported by the property insurance industry.

“Crash test dummies are used in the auto industry to make cars safer and we damage mobile homes to increase their safety,” Kaaz said. IBHS shares its findings with other insurance companies, builders and insurance regulators. “Consumer protection requires a team effort not only within the insurance industry but also across many governmental agencies and authorities across the country.”

Testing showed that attached structures, such as carports, can come loose in a wind storm and rip into a mobile home. This underscores the importance of taking steps to better secure attached structures, in some cases through truss tie-downs known as hurricane straps. According to IBHS, for every dollar spent on disaster mitigation, $ 4 are saved in community disaster recovery expenses.

The company monitors building codes across the country, and not just how they are written but also how well they are enforced. “We work on building standards for specific locations, and all that information goes into a map,” Kaaz said.

“There is a megatrend of more violent storms in the U.S. You have a right to feel safe within your own four walls, and scientific research with GIS can help create better homes. We are taking climate into account, not weather,” she added. “We are thinking of the next 1,000 years and we try to be more conservative than insurance companies usually are.”

American houses, both standard stick-build frame homes and mobile homes, are more vulnerable than houses in her native Germany which are usually stone or masonry, she said.

“As an industry, we have to protect what people want, and if they want frame housing we have to work from that. But the insurance industry also has to raise awareness. As risk managers, we should see awareness that others don’t.”

The company’s claims training center at its headquarters just outside Cincinnati is building a demonstration home to show how to make homes smarter, more sustainable and disaster resistant, she added.

“You should be safe in the first place and able to get out of harm’s way when you are threatened.”

For more on how to tap into innovative business opportunities, see What Happens When an Idea Becomes the Product?

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