A week? Two weeks? How long ago those floods seem in my mind now when in reality they were within a fortnight of today!
I remember trying to get a train back to London on the first day of (what should be called) ‘the Great Floods of 2012’. The South West was completely drenched, with swathes of water just running all over the place.
I spent the following weekend watching avidly on the television as the ordeal continued, anxiously wondering how my flatmates were coping.
A week later and it was still bad, sadly three people had lost their lives, one in the city I reside in. It was shocking to think something like this could happen and cause such disruption.
I vividly remember a lady on a replacement bus right at the start of the flooding remarking at the situation,
“Weren’t we just in a drought?!”
That was of course only the first of many drought references throughout the week, but still it stuck with me.
2012 hasn’t exactly been a stellar year on the weather front.
I know the UK doesn’t really have the ‘best’ weather and we get a bit of everything, but honestly…it’s definitely been far more ‘up-down’ than usual. And now it’s snowing casually. Bets on a White Christmas anyone?
Then there is the rest of the world:
The US-Hurricane Sandy; The Philippines- just recently hit by Typhoon Bopha; and countless other ‘natural disasters’.
Here in the UK, most people have returned to their normal lives. Like me, they watched in awe at what water can do and now that the main part of it is over, they carry on with their lives. (I wouldn’t blame anyone for that either).
However those villages, those families whose homes have been ruined. Surely they are still in the process of dealing with what a week of rain can do? The same for all around the world too.
It then concludes, someone somewhere is very busy. Insurance claims must be through the roof at the moment.
It might be a bit harsh and insensitive to say so, but poor insurance companies!
The whole point of an insurance company is to ‘pool risks‘. Through diversification insurance companies take your uncertainty (in return for a nice premium) and put it with a bunch of other ‘risky’ outcomes with the logic that all of the ‘bad’ outcomes of each risk will be very unlikely to happen(well at least simultaneously).
Well that hasn’t worked out really has it.
Even if an insurance company would not insure against a WHOLE town being flooded, a large company may now be facing claims from multiple location- people in the South West, people in the Midlands, perhaps even people in the US. It does add up; Not enough to make them bankrupt of course but still. I would be surprised if it’s not a record or something.
It’s no wonder they has been a rise of research and interest in the insurance world surrounding ‘Catastrophe Risk Modelling’. With ‘freak’ weather events becoming increasingly common, insurance companies need to be smarter about the risks they take, the premiums they’ll charge and how much they’ll cover.
So I guess on the bright side, if you’re interested in the whole insurance business… (What is that I hear? Oh look, more jobs being created in the private sector!)…you could be in demand!
Especially if you’re a maths/statistics ninja (a graduate will suffice); What are you waiting for?