Product / Service
Property Damage and Business Interruption
Commercial Property Risk Management and Insurance
What is the optimal strategy for managing and protecting an organisation's assets, balance sheet and growth while reducing high premium costs and peril exposures? A proactive approach to property risk management integrates both pre- and post-loss strategies to minimise the impact of a potential loss event. It also considers key market dynamics, such as insurance capacity and rates, natural catastrophe exposures and macroeconomics, to develop a strategy that optimises the value of risk transfer to insurers.
Why is BI Valuation Important?
An organisation’s value is reflected in its future cash flows, not necessarily its net assets, so the preservation of these cash flows is paramount. Business interruption losses can be significant and often have the ability to materially compromise an organisation. As a result, the need to protect shareholder value and an increased focus on good corporate governance are leading more organisations to develop an auditable process that supports the determination of the correct type and amount of business interruption cover.
BI risk profiles will often vary across business segments and asset locations, so insuring on a one-size-fits-all basis can lead to over-insuring in one area of the business and underinsuring in another. Accurately quantifying BI values is critical for businesses as it provides the insight necessary to make informed decisions on the level of insurance coverage needed and the ability to tailor cover to efficiently protect against losses.
A BI valuation can provide insurers with a better understanding of an organization’s BI risk profile which may be able to be leveraged to negotiate better renewal terms, for example, more favourable premium levels, capacity and coverage limits.
The BI valuation process can also help companies identify areas where they can improve their risk management strategies and develop contingency plans to minimize the impact of business interruption events.
What is the BI Valuation Process?
- Collect Data Collecting key business and financial data
- Identify Exposures Identifying specific risks and exposures
- Investigate Concerns Investigating areas of concer
- Analyse Risk Analysing risk mitigation strategies and assumptions
- Develop Model Developing a BI valuation model
- Create Methodology Creating an ongoing methodology to revisit BI valuation
Our Approach
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Advanced Risk Modeling
We work to understand our clients’ risks and exposures fully. Aon brokers and actuaries use advanced risk modeling to support better decision-making around key criteria such as rates, retentions, limits and deductibles to ensure the best insurance value for the price.
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Benchmarking Data
Our team uses a database of thousands of accounts and data points, including premiums, rates, deductibles/retention and limits. We can also benchmark by industry and geography, giving our clients unique insights into the market and delivering optimal programme results.
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Risk Control and Claims Support
Our in-depth knowledge of risk control and claims is integrated into our property service platform. We track potentially catastrophic events around the globe against client exposures using our proprietary ImpactOnDemand technology.
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Property Risk Analyzer
Aon’s Property Risk Analyzer is a digital application that provides exposure visualisation, models potential losses and simulates insurance programme options and total cost of risk. It enables clients to make better, data-driven decisions to optimise the value of their commercial property insurance programme. The tool is designed to give clients swifter access to analytics and thereby increase control over their insurance programme structure.
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Global Access
Aon annually places $16 billion in property premium, ensuring access to the global underwriting market. We work alongside Global Broking Centers in the U.S., London, Bermuda and Singapore, which are staffed with more than 200 broking professionals who provide additional specialist knowledge and solutions. We can access any market on your behalf, to ensure that you get the best possible deal.
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Natural Catastrophe Experience
As extreme weather events increase in frequency, it’s important to be aware of potential vulnerabilities to natural disasters and catastrophes. We are a leading broker for large catastrophe-exposed wind, flood, terrorism, and earthquake coverage.
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Parametric Insurance and Structured Property Programs
Aon offers innovative alternative risk transfer solutions to finance property risk, including, where applicable: parametric insurance to accelerate claim recoveries and multi-year, loss-sensitive structured reinsurance solutions that can drive cost savings.
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Business Interruption, Contingent BI and Asset Valuations
Reporting accurate values for assets, business interruption (BI), and contingent business interruption (CBI) can be difficult and time-consuming. Aon’s experience with quantifying these assets helps clients report these values more accurately to underwriters, ensuring that premiums accurately reflect the risk, and any negotiations with insurers in the event of a loss run as smoothly as possible.
More Property Risk Insights
Read the latest articles, reports and podcasts about property risk management from our team of thought leaders.
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Report
Climate and Catastrophe Insight -
Report
Property Market Dynamics Report -
Podcast
On Aon Podcast: Navigating and Preparing for Catastrophes -
Article
Climate Change: Evolving Property Risk to Resilience -
Article
Four Steps to Develop Strong Property Risk Coverage in a Hardening Market -
Article
Navigating Climate Risk Using Multiple Models and Data Sets
