Karen Clark & Company flood model certified by Florida Commission

Karen Clark & Company’s flood model has been certified by the Florida Commission on Hurricane Loss Projection Methodology. The KCC Flood Model is the only flood model that has been found acceptable by the Commission, so far.

The KCC Flood Model indicates that the average annual losses from currently insured policies is over $1 billion in the state of Florida. Insured losses from large events can exceed $30 billion.

The model covers coastal flooding from storm surge and inland flooding from extreme rainfall. The model includes a catalog of over 100,000 flood intensity footprints created and stored at 30-meter resolution along with thousands of vulnerability functions accounting for important property features, such as building construction, height, first floor elevation, and other secondary characteristics.

“We are pleased to deliver to the market the first flood model that has been independently reviewed and certified by an external team of experts,” said Glen Daraskevich, KCC senior vice president.

“The Florida Commission review process includes verifying a comprehensive set of standards covering all of the meteorological, hydrological, hydraulic, engineering, and actuarial aspects of the model. Each flood model standard was verified through a rigorous audit process extending over a several month period.”

Joanne Yammine, KCC director of Actuarial Services, added: “The private market for flood insurance is relatively small, and most of the residential properties that are currently insured are covered by the National Flood Insurance Program (NFIP). The KCC Flood Model is the first flood model to be found acceptable for ratemaking in the state of Florida so insurers can start writing flood business with higher confidence and at adequate rates. The KCC model can be used to price and underwrite commercial as well as residential policies.”