Torrent Urges Congress to Extend National Flood Insurance Program
New York | August 18, 2020
Highlights Need for Public and Private Sectors to Mitigate Flood Risk in New Report
In a new report published today, Marsh subsidiary Torrent Technologies, a flood insurance technology and servicing company and direct servicing agent of the National Flood Insurance Program (NFIP), highlights the need for public and private sectors to take collaborative action now to mitigate catastrophic flood risk.
According to the report, 40% of the US population, or 127 million people, live in coastal counties today putting them at risk of storm surge and record-setting high tides from rising sea levels, both significant sources of coastal flooding.
“Policymakers, regulators, insurance leaders, and other stakeholders should work diligently to ensure that flood risk does not add to the financial burden the country is facing,” said Kevin Tobin, President and CEO of Torrent. “Action is needed now, especially in light of the extremely active 2020 Atlantic hurricane season and rising sea levels.”
Chief among these actions is to extend the NFIP, the main source of flood insurance in the US, which is set to expire September 30, Mr. Tobin said. If the NFIP is allowed to lapse, no new flood coverage can be written by the program, which could constrain real estate transactions and economic recovery.
An NFIP extension is not assured, the report notes. The process is further complicated by 2020 being an election year, and one where legislators’ attention is focused on combating the COVID-19 pandemic.
“We urge policymakers to extend the NFIP and keep flood insurance available to the millions of Americans who need it,” Mr. Tobin said.
But flood risk is not a problem that insurance alone can solve, the report stresses. It requires coordinated resiliency efforts involving the public and private sectors. The underlying principle of the code is that flood resilience must combine resistance — measures that hold back water — with the ability to recover quickly.
Among other recommendations Torrent suggests for governments, regulatory authorities, and the insurance industry: simplify the flood insurance purchasing process; share flood risk data; continue flood-related technology innovation; amplify resiliency; combine government-backed programs with private-sector risk analytics; and explore parametric insurance solutions.
“Together, the public and private sectors can apply innovative insurance solutions, resilience planning and execution, fresh technologies, and new processes to better understand and evaluate flood risk in the US with the goal of building more resiliency and mitigating damages,” Mr. Tobin said.
For more on the flood insurance market and a list of action items to build more flood resiliency, download Torrent’s 2020 State of Flood Report.
About Torrent Technologies
Torrent Technologies Inc. is a business services subsidiary of Marsh that leverages technology to improve the underwriting, distribution and claims service of flood insurance. About 75% of Torrent’s Write Your Own (WYO) carrier clients utilize its full business process outsourcing capabilities, which include underwriting, claims, accounting, agency support, information technology and mailing services. A cloud-based, software as a service model enables clients to retain elements of flood insurance servicing. With an agile approach to technology, Torrent has been able to accelerate quoting, policy issuance and claim payments. Torrent also offers automated private primary flood and excess flood policies for WYOs, their agents and clients.
Marsh is the world’s leading insurance broker and risk advisor. With around 40,000 colleagues operating in more than 130 countries, Marsh serves commercial and individual clients with data-driven risk solutions and advisory services. Marsh is a business of Marsh McLennan (NYSE: MMC), the world’s leading professional services firm in the areas of risk, strategy and people. With annual revenue over $17 billion, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment through four market-leading businesses: Marsh, Guy Carpenter, Mercer and Oliver Wyman. Follow Marsh on Twitter @MarshGlobal; LinkedIn; Facebook; and YouTube, or subscribe to BRINK.