CHICAGO, Dec. 19, 2024 - Aon plc (NYSE: AON), a leading global professional services firm, today announced a collaboration with flood expert, Fathom, that will enhance its Climate Risk Monitor solution and assist clients to better understand the influence of a changing climate on flood perils worldwide.
Climate Risk Monitor, launched in March this year, allows clients to visualize and analyze their operational exposures to physical climate risk to drive better risk management decisions. Aon data shows that the property insurance market is increasingly influenced by climate-related perils, with more than $125B of insured losses caused by weather-related catastrophes in 2024.
The new collaboration with Fathom utilizes high resolution data to bolster Climate Risk Monitor’s functionality across flash flooding, river flooding, coastal flooding and rising sea levels. As a result, Aon clients can now use the solution to assess U.S., UK and Japan flood risk at a resolution of 10 square meters, and 30 square meters for other regions globally.
The addition of high-resolution flood data within Climate Risk Monitor provides forward projections of flood risk across a range of emissions scenarios, helping re/insurers to understand the insurability of the flood peril, as well as supporting due diligence and disclosure and regulatory requirements.
Aside from flood risk, Climate Risk Monitor can model the prevalence of drought, extreme rainfall, extreme heat, freeze, tropical cyclone and wildfire under different climate change scenarios, providing clients with diagnostic reports both on individual asset and portfolio impacts, as well as geographical visualizations of changing risk.
Fathom flood data is also incorporated into Aon’s recently certified Florida Flood v3.0 model from Impact Forecasting, which is available within the team’s ELEMENTS 18 catastrophe modeling suite.
Liz Henderson, global head of Climate Risk Advisory for Aon, said: “The dynamics of the flood peril are particularly sensitive to climate change, which raises growing concerns around global insurability and protection gaps, highlighted by the significant flood events of 2024. Our collaboration with Fathom will help to further enhance the value Climate Risk Monitor brings to clients, not just around physical risk management but also shaping better decisions on human capital in the areas of health, resource allocation and investment.”
Harry Vardigans, head of insurance at Fathom, said: “Building on the success of our previous collaborations with Aon, it’s great to once again join forces to see Fathom’s high-resolution flood risk data integrated into Climate Risk Monitor. Armed with our flood risk intelligence, Aon’s clients can assess and manage their flood risk exposure for anywhere in the world, strengthening the creation of robust risk strategies in an era of increasing climate volatility.”
Climate Risk Monitor allows clients to assess evolving risk profiles and manage risk in locations with projected increases – thereby assisting risk mitigation and transfer strategies – while helping them to demonstrate climate understanding and planning to stakeholders, and supporting climate disclosures.
The tool can also inform risk selection and strategies around pricing and re/insurance renewals, drawing on Aon’s wide-ranging scientific and business expertise to transform a wealth of well-validated climate data into useful information for clients.
Henderson added: “Risk managers can use Aon data to better understand climate risk and, in turn, inform property insurance placements for their organizations, collaborating with Aon’s brokers to help obtain optimal limits and renewal pricing. As part of Aon’s Risk Capital capability, the firm brings broad expertise, relationships and analytics to help clients to unlock capital and mitigate risk.”
About Aon
Aon plc (NYSE: AON) exists to shape decisions for the better — to protect and enrich the lives of people around the world. Through actionable analytic insight, globally integrated Risk Capital and Human Capital expertise, and locally relevant solutions, our colleagues provide clients in over 120 countries with the clarity and confidence to make better risk and people decisions that protect and grow their businesses.
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