Sponsored: AXA XL

Property Losses from Catastrophes Are Getting Worse. Data Transparency and Teamwork Are Key to Reduce the Risk

Carriers who take an integrated and transparent approach are best equipped to help clients proactively mitigate growing property exposures.
By: | June 3, 2019

Increasing intensity of natural disasters and more unpredictable weather has made managing property exposures more challenging than ever.

Climate scientists say the 2017 hurricane season — the most expensive in U.S. history — could be a harbinger of more severe storms to come. The slowly rising sea level is contributing to more frequent flooding, and NOAA predicts that severe floods are likely to worsen. Wildfires, fueled by parched forests and high winds, are trending up in size as wildfire seasons grow longer.

However, more sophisticated technology and data analysis tools can help risk managers more proactively assess and mitigate their exposures.

“The more you know about a risk, the better prepared you can be,” said Mark Evans, Head of North America Property Claims, AXA XL. “A growing volume of data and advanced analytical capabilities allow insurers and insureds to make better risk decisions.”

Better processes at the front end of the insurance transaction can also help companies better prepare for and recover from losses. Some carriers are bringing more of their internal resources to bear much earlier for clients to help proactively mitigate risk.

AXA XL’s three-pronged approach leverages engineering expertise, data insights, and internal teamwork to more proactively mitigate property loss.

1. Risk engineering consultants coach clients through mitigation recommendations.

Mark Evans, Head of North America Property Claims, AXA XL

Risk engineers are best equipped to evaluate a property’s vulnerabilities and recommend ways to mitigate them. It’s not uncommon for an insurer to send out a risk consultant or engineer to a new client’s site to do just that, but often these surveys are limited to once per year.

Companies need more than a single visit from a risk engineer to make the most of their feedback.

“Our field engineers have more touch points with clients than anyone else. They are out in facilities every day, meeting with clients throughout the year,” said Scott Ewing, Regional Director, Property Risk Engineering, AXA XL. “We did more than 5,500 surveys of facilities last year in North America.”

Spending more time with clients means engineers can adopt the role of risk coach, actively helping risk managers prioritize and implement new protocols. That includes everything from training front-line employees on new procedures, to helping to select new building materials for capital improvement projects.

“When a client’s going to embark upon a project, whether it’s installing fire protection or building a new facility, we’ll work with them on selecting the proper materials, making sure the roof is proper for their windstorm rating, for example,” Ewing said. “It is a full suite of services that we offer our clients to help them manage their risk from the ground up.”

2. Data transparency empowers risk managers to be proactive.

Scott Ewing, Regional Director, Property Risk Engineering, AXA XL

While risk consultants conduct site surveys, they are collecting reams of detailed information about the property, including both its strengths and weaknesses. Many carriers take an exception reporting approach, letting clients know only about the problems discovered, but keeping the full breadth of the report to themselves.

Some carriers withhold that information because they view releasing it as a competitive disadvantage. The client could take a full report, after all, and use it to market themselves to other insurers. Most carriers don’t want their competitors to see the data used to underwrite a risk.

“They’ll provide a risk score and a list of recommendations, but we think a more collaborative and transparent approach benefits everyone,” said Michele Sansone, Chief Underwriting Officer, North America Property, AXA XL.

“We give our clients the full construction, occupancy, protection and exposure data, full hazard write-ups, and all of the secondary characteristics they can use for their own CAT modeling. We believe it’s their data, and they should own it.”

Ultimately, providing companies with this data enables a more proactive approach to resiliency, which reduces the potential severity of future losses.

“We’re populating a database through which clients have full access to all of their data. And we’re providing more visualization so that risk managers can make better business decisions on how to improve their risks,” Evans said.

3. Internal integration improves both loss prevention and recovery efforts.

Michele Sansone, Chief Underwriting Officer, North America Property, AXA XL

Collaboration among risk engineering consultants, claims professionals and underwriters from the very beginning of a client relationship also enables better loss prevention, as well as faster recovery when a claim does happen.

“In addition to a risk engineering consultant, a claims person is assigned to every new submission we receive. Underwriting, claims and risk engineering often go to client meetings together and work together on an account from the beginning,” Sansone said.

This has dual benefits for clients from both a loss prevention and recovery perspective.

“Our claims professionals have a front-line view of the losses coming in and can spot patterns. We take that information and look for ways to develop programs that address the common issues at the root of those losses,” Ewing said.

For example, the claims team at AXA XL noticed a large volume of non-flood-related water damage claims — the kind resulting from leaky or burst pipes. So, working with risk engineers, they developed a program called Waterworks that helps clients understand how to monitor their plumbing systems and take action when a leak is detected.

“Over the last two years since the engineers initiated the Waterworks program, we’ve actually seen a decrease in the volume of water losses following those artic freezes in North America than we have in years past,” Evans said.

A risk manager who is familiar with their claims contact before a loss can also get the ball rolling much faster when they do eventually need to file a claim. Especially after a catastrophe, recovery often involves many moving parts, and time is of the essence. Knowing who to call to report the loss right away removes one step and can help companies hit the ground running.

After earthquake struck Alaska in late 2018, “we were able to get people up there within the first week post-loss and began assessing the situation. It allowed us to get an advanced payment out much quicker. We gave them 60 percent of their limit within a matter of two weeks,” Evans said.

Quick recovery is also possible because — thanks to early alignment of risk consultants, claims managers and underwriters — policies respond they way that clients expect them to.

“Handling claims is normally 50 or 60 percent of what a claims person does. The rest of their time is spent interacting with clients and relaying back to underwriters if they think coverage is not going to operate the way that the insured wants,” Evans said.

A New Tool Drives Loss Prevention Forward

This integrated approach and a commitment to total data transparency have produced positive outcomes for clients even as the property risk landscape becomes more fraught.

A new client portal and data analytics platform called SiteForward is a continuation of those approaches.

SiteForward provides a centralized place for risk managers to view their reports across all of their locations, including mitigation recommendations. It includes tools for risk managers to calculate ROI on loss prevention actions, track progress on risk improvement projects, generate reports, create models to conduct “what if” analyses, view Nat Cat exposures anywhere in the world, and keep an eye on catastrophes as they unfold.

“This level of transparent data analysis means we can make decisions with clients in real-time, both before and after a loss,” Ewing said.

“It’s true that over the past few years we’ve seen a higher frequency in natural catastrophes, but we’ve also seen that our clients have been better equipped to deal with the aftermath and get back in business much quicker,” Sansone said.

“Doing more risk engineering work upfront, empowering the client to make better business decisions, and having more touch points all contribute to that result. SiteForward will help us do all three.”

To learn more, visit https://axaxl.com/.


This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with AXA XL. The editorial staff of Risk & Insurance had no role in its preparation.

AXA XL, the property & casualty and specialty risk division of AXA, provides insurance and risk management products and services for mid-sized companies through to large multinationals, and reinsurance solutions to insurance companies globally. We partner with those who move the world forward. To learn more, visit www.axaxl.com.

More from Risk & Insurance

More from Risk & Insurance

Risk Scenario

The Betrayal of Elizabeth

In this Risk Scenario, Risk & Insurance explores what might happen in the event a telemedicine or similar home health visit violates a patient's privacy. What consequences await when a young girl's tele visit goes viral?
By: | October 12, 2020
Risk Scenarios are created by Risk & Insurance editors along with leading industry partners. The hypothetical, yet realistic stories, showcase emerging risks that can result in significant losses if not properly addressed.

Disclaimer: The events depicted in this scenario are fictitious. Any similarity to any corporation or person, living or dead, is merely coincidental.


Elizabeth Cunningham seemingly had it all. The daughter of two well-established professionals — her father was a personal injury attorney, her mother, also an attorney, had her own estate planning practice — she grew up in a house in Maryland horse country with lots of love and the financial security that can iron out at least some of life’s problems.

Tall, good-looking and talented, Elizabeth was moving through her junior year at the University of Pennsylvania in seemingly good order; check that, very good order, by all appearances.

Her pre-med grades were outstanding. Despite the heavy load of her course work, she’d even managed to place in the Penn Relays in the mile, in the spring of her sophomore season, in May of 2019.

But the winter of 2019/2020 brought challenges, challenges that festered below the surface, known only to her and a couple of close friends.

First came betrayal at the hands of her boyfriend, Tom, right around Thanksgiving. She saw a message pop up on his phone from Rebecca, a young woman she thought was their friend. As it turned out, Rebecca and Tom had been intimate together, and both seemed game to do it again.

Reeling, her holiday mood shattered and her relationship with Tom fractured, Elizabeth was beset by deep feelings of anxiety. As the winter gray became more dense and forbidding, the anxiety grew.

Fed up, she broke up with Tom just after Christmas. What looked like a promising start to 2020 now didn’t feel as joyous.

Right around the end of the year, she plucked a copy of her father’s New York Times from the table in his study. A budding physician, her eyes were drawn to a piece about an outbreak of a highly contagious virus in Wuhan, China.

“Sounds dreadful,” she said to herself.

Within three months, anxiety gnawed at Elizabeth daily as she sat cloistered in her family’s house in Bel Air, Maryland.

It didn’t help matters that her brother, Billy, a high school senior and a constant thorn in her side, was cloistered with her.

She felt like she was suffocating.

One night in early May, feeling shutdown and unable to bring herself to tell her parents about her true condition, Elizabeth reached out to her family physician for help.

Dr. Johnson had been Elizabeth’s doctor for a number of years and, being from a small town, Elizabeth had grown up and gone to school with Dr. Johnson’s son Evan. In fact, back in high school, Evan had asked Elizabeth out once. Not interested, Elizabeth had declined Evan’s advances and did not give this a second thought.

Dr. Johnson’s practice had recently been acquired by a Virginia-based hospital system, Medwell, so when Elizabeth called the office, she was first patched through to Medwell’s receptionist/scheduling service. Within 30 minutes, an online Telehealth consult had been arranged for her to speak directly with Dr. Johnson.

Due to the pandemic, Dr. Johnson called from the office in her home. The doctor was kind. She was practiced.

“So can you tell me what’s going on?” she said.

Elizabeth took a deep breath. She tried to fight what was happening. But she could not. Tears started streaming down her face.

“It’s just… It’s just…” she managed to stammer.

The doctor waited patiently. “It’s okay,” she said. “Just take your time.”

Elizabeth took a deep breath. “It’s like I can’t manage my own mind anymore. It’s nonstop. It won’t turn off…”

More tears streamed down her face.

Patiently, with compassion, the doctor walked Elizabeth through what she might be experiencing. The doctor recommended a follow-up with Medwell’s psychology department.

“Okay,” Elizabeth said, some semblance of relief passing through her.

Unbeknownst to Dr. Johnson, her office door had not been completely closed. During the telehealth call, Evan stopped by his mother’s office to ask her a question. Before knocking he overheard Elizabeth talking and decided to listen in.


As Elizabeth was finding the courage to open up to Dr. Johnson about her psychological condition, Evan was recording her with his smartphone through a crack in the doorway.

Spurred by who knows what — his attraction to her, his irritation at being rejected, the idleness of the COVID quarantine — it really didn’t matter. Evan posted his recording of Elizabeth to his Instagram feed.

#CantManageMyMind, #CrazyGirl, #HelpMeDoctorImBeautiful is just some of what followed.

Elizabeth and Evan were both well-liked and very well connected on social media. The posts, shares and reactions that followed Evan’s digital betrayal numbered in the hundreds. Each one of them a knife into the already troubled soul of Elizabeth Cunningham.

By noon of the following day, her well-connected father unleashed the dogs of war.

Rand Davis, the risk manager for the Medwell Health System, a 15-hospital health care company based in Alexandria, Virginia was just finishing lunch when he got a call from the company’s general counsel, Emily Vittorio.

“Yes?” Rand said. He and Emily were accustomed to being quick and blunt with each other. They didn’t have time for much else.

“I just picked up a notice of intent to sue from a personal injury attorney in Bel Air, Maryland. It seems his daughter was in a teleconference with one of our docs. She was experiencing anxiety, the daughter that is. The doctor’s son recorded the call and posted it to social media.”

“Great. Thanks, kid,” Rand said.

“His attorneys want to initiate a discovery dialogue on Monday,” Emily said.

It was Thursday. Rand’s dreams of slipping onto his fishing boat over the weekend evaporated, just like that. He closed his eyes and tilted his face up to the heavens.

Wasn’t it enough that he and the other members of the C-suite fought tooth and nail to keep thousands of people safe and treat them during the COVID-crisis?

He’d watched the explosion in the use of telemedicine with a mixture of awe and alarm. On the one hand, they were saving lives. On the other hand, they were opening themselves to exposures under the Health Insurance Portability and Accountability Act. He just knew it.

He and his colleagues tried to do the right thing. But what they were doing, overwhelmed as they were, was simply not enough.


Within the space of two weeks, the torture suffered by Elizabeth Cunningham grew into a class action against Medwell.

In addition to the violation of her privacy, the investigation by Mr. Cunningham’s attorneys revealed the following:

Medwell’s telemedicine component, as needed and well-intended as it was, lacked a viable informed consent protocol.

The consultation with Elizabeth, and as it turned out, hundreds of additional patients in Maryland, Pennsylvania and West Virginia, violated telemedicine regulations in all three states.

Numerous practitioners in the system took part in teleconferences with patients in states in which they were not credentialed to provide that service.

Even if Evan hadn’t cracked open Dr. Johnson’s door and surreptitiously recorded her conversation with Elizabeth, the Medwell telehealth system was found to be insecure — yet another violation of HIPAA.

The amount sought in the class action was $100 million. In an era of social inflation, with jury awards that were once unthinkable becoming commonplace, Medwell was standing squarely in the crosshairs of a liability jury decision that was going to devour entire towers of its insurance program.

Adding another layer of certain pain to the equation was that the case would be heard in Baltimore, a jurisdiction where plaintiffs’ attorneys tended to dance out of courtrooms with millions in their pockets.

That fall, Rand sat with his broker on a call with a specialty insurer, talking about renewals of the group’s general liability, cyber and professional liability programs.

“Yeah, we were kind of hoping to keep the increases on all three at less than 25%,” the broker said breezily.

There was a long silence from the underwriters at the other end of the phone.

“To be honest, we’re borderline about being able to offer you any cover at all,” one of the lead underwriters said.

Rand just sat silently and waited for another shoe to drop.

“Well, what can you do?” the broker said, with hope draining from his voice.

The conversation that followed would propel Rand and his broker on the difficult, next to impossible path of trying to find coverage, with general liability underwriters in full retreat, professional liability underwriters looking for double digit increases and cyber underwriters asking very pointed questions about the health system’s risk management.

Elizabeth, a strong young woman with a good support network, would eventually recover from the damage done to her.

Medwell’s relationships with the insurance markets looked like it almost never would. &


Risk & Insurance® partnered with Allied World to produce this scenario. Below are Allied World’s recommendations on how to prevent the losses presented in the scenario. This perspective is not an editorial opinion of Risk & Insurance.®.

The use of telehealth has exponentially accelerated with the advent of COVID-19. Few health care providers were prepared for this shift. Health care organizations should confirm that Telehealth coverage is included in their Medical Professional, General Liability and Cyber policies, and to what extent. Concerns around Telehealth focus on HIPAA compliance and the internal policies in place to meet the federal and state standards and best practices for privacy and quality care. As states open businesses and the crisis abates, will pre-COVID-19 telehealth policies and regulations once again be enforced?

Risk Management Considerations:

The same ethical and standard of care issues around caring for patients face-to-face in an office apply in telehealth settings:

  • maintain a strong patient-physician relationship;
  • protect patient privacy; and
  • seek the best possible outcome.

Telehealth can create challenges around “informed consent.” It is critical to inform patients of the potential benefits and risks of telehealth (including privacy and security), ensure the use of HIPAA compliant platforms and make sure there is a good level of understanding of the scope of telehealth. Providers must be aware of the regulatory and licensure requirements in the state where the patient is located, as well as those of the state in which they are licensed.

A professional and private environment should be maintained for patient privacy and confidentiality. Best practices must be in place and followed. Medical professionals who engage in telehealth should be fully trained in operating the technology. Patients must also be instructed in its use and provided instructions on what to do if there are technical difficulties.

This case study is for illustrative purposes only and is not intended to be a summary of, and does not in any way vary, the actual coverage available to a policyholder under any insurance policy. Actual coverage for specific claims will be determined by the actual policy language and will be based on the specific facts and circumstances of the claim. Consult your insurance advisors or legal counsel for guidance on your organization’s policies and coverage matters and other issues specific to your organization.

This information is provided as a general overview for agents and brokers. Coverage will be underwritten by an insurance subsidiary of Allied World Assurance Company Holdings, Ltd, a Fairfax company (“Allied World”). Such subsidiaries currently carry an A.M. Best rating of “A” (Excellent), a Moody’s rating of “A3” (Good) and a Standard & Poor’s rating of “A-” (Strong), as applicable. Coverage is offered only through licensed agents and brokers. Actual coverage may vary and is subject to policy language as issued. Coverage may not be available in all jurisdictions. Risk management services are provided or arranged through AWAC Services Company, a member company of Allied World. © 2020 Allied World Assurance Company Holdings, Ltd. All rights reserved.

Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]