Severe Weather Alert Systems: A Snap Poll for the Celent Executive Panel

Snap polls reflect questions posed by members of the Celent Executive Panel, a group of C level executives at insurance carriers. This comes from an insurer that is looking for insights on severe weather alerts. The snap poll was conducted Oct 21 – Oct 23 2024, on behalf of an insurer looking for insights on severe weather alert systems to notify policyholders in the paths of upcoming weather events and help them prepare.

11 insurers responded to this survey. This deck provides a summary of the responses.

If you are an insurer and are interested in participating and receiving these snap polls, please email kcarnahan@celent.com to verify eligibility.

The question that was posed was:

Background:

This insurer is thinking about creating a Severe Weather Alert (SWA) system to provide hyper-targeted messaging to customers that are in the path of a major weather event. This hyper-targeted messaging would be specific to the insured property (home, auto, business, etc.) and to the specific geo-coded location. Messages delivered would provide specific guidance to safe-guard certain insured property in advance of the weather event, as well as, provide weather updates during and following the weather event. They believe the benefit of having a SWA system is to reduce loss frequency and severity by proactively alerting customers to take appropriate action to reduce loss exposure. They’re interested if others have gone down this path and if so, how it’s going.

Questions:

Do you have a Severe Weather Alert system? (Even if the answer is no, we’d love your answer to this question.)

• If yes, how long have you had it?

If you did roll out a solution like this, did you build it yourself or did you buy a solution? (if you bought, who did you consider?)

If you did roll out a solution, who owns it functionally? IT? Marketing? Loss control? Somewhere else?

To what extent is your company seeing a reduction in claim frequency and severity based on using a SWA system? (Please use the 1-5 scale below)

• 1 – Not seeing any meaningful reduction in claims activity
• 2 – Some reduction in claims activity, but not enough to offset investment in the SWA system
• 3 – Enough of a reduction to cover/offset the SWA system investment, but still need more reductions in claims activity to lower claims expenses
• 4 – Reduction in claims activity is covering the cost of the SWA system and having some positive impact on lowering claims expenses
• 5 - Reduction in claims activity is covering the cost of the SWA system and having a significant positive impact on lowering claims expenses

Beyond claim frequency/severity are there any other metrics you’re using to measure the success of this type of system? E.g. customer retention, NPS, etc.

Have you achieved break-even such that the reduction in claims frequency and severity (or improvement in other benefits) was able to cover the annual cost of the SWA system?

• If so, how long did it take?

In the end, do you feel the results achieved from having an SWA system was worth the financial investment?

Do you have any advice on how to effectively implement it? E.g. were there any specific actions to communicate with your agents or policyholders beforehand that you think were particularly effective?

Any other insights would be greatly appreciated!