FireLine Overview CA ISO Workshop AS · Verisk Insurance Solutions | ISO AIR Worldwide Xactware | Proprietary and Confidential 1 Director, Product Management and Innovation . The

Arindam Samanta PhD

FireLine™Overview

Verisk Insurance Solutions | ISO AIR Worldwide Xactware | Proprietary and Confidential 1

Arindam Samanta PhDDirector, Product Management and Innovation

The Wildfire Peril

• Fire seasons have grown longer, and the frequency, size,

and severity of wildland fires has increased

• By 2010, the Wildland Urban Interface covers 10% of the

contiguous 48 states and includes approximately 1 in 3


homes

• The US Forest Service cost for wildfire suppression has

topped $1billion per year for the last 5 years

• In late August 2015, the cost of wildfire suppression

reached a record $243 million in a one week period

The Wildfire Peril

• One of the costliest catastrophe peril in US

• Over $4 billion in losses during the past 10 years in US

• The record setting 2015 fire season included 68,151

wildfires which burned 10,125,149 acres


• 2016 Ft. McMurray fire in Alberta, Canada

– The largest insured natural catastrophe in Canadian history

– Entire population of about 90,000 evacuated

– 1,600 buildings destroyed

– Losses of approximately $3.6 billion.

The Wildfire Peril

$3,000,000,000

$3,500,000,000

$4,000,000,000

$4,500,000,000

California Wildfire Losses


$0

$500,000,000

$1,000,000,000

$1,500,000,000

$2,000,000,000

$2,500,000,000

1960's 1970's 1980's 1990's 2000's 2010's To Date

California Wildfire Losses

Catastrophe Pricing Challenges

• Non-diversifiable exposure

• Expanded development in CAT prone areas

• Climate change


• Estimating future losses without data

• Price commensurate with exposure

FireLine History

Oakland/Berkeley ‘Tunnel Fire’ of 1991 caused about $1.7 billion dollars in insured losses

1993 Fires in Oakland and Orange counties


1993 Fires in Oakland and Orange counties caused an additional $700 million in insured losses

ISO was approached by several insurers about the possibility of developing improved wildfire hazard rating using satellite imaging techniques

FireLine backed by diverse expertise

• Multi-disciplinary experts participated in development and involved in ongoing maintenance:

– Forestry/wildland science – PhD scientists

– Remote Sensing – PhD Scientists

– Computer Science – Masters Degrees


– Computer Science – Masters Degrees

– Insurance – PhD level

– Community fire protection

– State and local authorities – CA Dept. of Forestry

FireLine Coverage

• Integrates known risk factors

• Objective scoring system

– Numerical scores (0-30)

OR

WA

ID

NVUT CO

MT

WY


– Numerical scores (0-30)

– Descriptive assessments

(negligible, low, moderate,

high, and extreme)

CA

TX

AZ NMOK

Wildfire Hazard Assessment


Identified by the NFPA as critical components for the wildfire hazard rating calculation

Vegetative Fuels Terrain Road Access

Fuels beyond the property boundaries are essential in wildfire risk assessment


Special Hazard Interface Area

This picture, taken in November 2003, shows a view of a southern-facing area of San Bernardino. The destroyed properties were located outside traditional wildfire fuels areas, but inside FireLine’s Special Hazard Interface Area.


Topography

Vegetation

Verisk

TechnologyAnalytics Risk

Assessment

Remote Sensing

Individual FireLine

Scalability

Statewide Wildfire Risk

Leading Science and Technology used in FireLine

Verisk Insurance Solutions | ISO AIR Worldwide Xactware | Proprietary and Confidential

Topography

Road Network

Weather

Sensing Technology

Digital Mapping

Technology

FireLine Score

Wildfire Risk

12

FireLine™ has been highlighted by NASA and the USGS

FireLine is highlighted as an outstanding commercial application that uses Landsat data at the Landsat Data Continuity Mission (LDCM) pre-launch press conference.


FireLine: California Distribution

8694997

6000000

7000000

8000000

9000000

10000000

Estim

ated Number of Households

Neglible

Low


State Risk Map State Exposure Distribution

1266006

1664721

1897685

1566710

1000000

2000000

3000000

4000000

5000000

Estim

ated Number of Households

Low

Moderate

High

Extreme

Summary: Station Fire, CA

FireLine™ Highlights:�Over 100 damaged / destroyed properties

�Percentage of damaged / destroyed properties identified as exposed to the wildfire hazard: 95%

�Percentage of damaged / destroyed

A High Percentage of the Losses Occurred in the Wildland-Urban Interface


Station Fire, CA, Oct. 2009: Fuels analyzed in FireLine™ are shown in map colors.

�Percentage of damaged / destroyed properties located in the Special Hazard Interface Area: 83%

47%

41%

1%

4%7%

Distribution of FireLine™ Hazard Category

Source: CALFIRE (http://cdfdata.fire.ca.gov/incidents/incidents_details_info?incident_id=377)

ExtremeNegligibleLow

Moderate

High

Summary: Butte Fire, CA (2015)

FireLine™ Highlights:�Almost 600 damaged / destroyed properties

�Percentage of damaged / destroyed properties identified as exposed to the wildfire hazard: 98.6%

�Percentage of damaged / destroyed


Butte Fire, CA, September 2015: Fuels analyzed in FireLine™ are shown in map colors.

�Percentage of damaged / destroyed properties located in moderate to high/extreme risk areas: 97%

Distribution of FireLine™ Hazard Category

83%

2%

1%

2%12%

ExtremeNegligibleLow

Moderate

High

Source: GEOMAC(http://rmgsc.cr.usgs.gov/outgoing/GeoMAC/current_year_fire_data/California/Butte)

Thank you for your time!

Verisk Insurance Solutions | ISO AIR Worldwide Xactware | Proprietary and Confidential

Thank you for your time!

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FireLine Overview CA ISO Workshop AS · Verisk Insurance Solutions | ISO AIR Worldwide Xactware | Proprietary and Confidential 1 Director, Product Management and Innovation . The