Mapping systemic flood risk.

In 2007, the Mythe Water Treatment Plant was shut down to protect it from disastrous damage. This resulted in nearly 300,000 people losing access to clean drinking water, some of them for up to 2 weeks. Roads were closed, businesses were shut, emergency services had difficulty accessing certain areas. People that lived miles from identifiable flood risk areas were hit badly, Their lives disrupted. 

This shows clearly, our flood maps are only the tip of the iceberg. We need systemic flood risk maps.

Systemic Risk

Insurance companies and the Environment Agency (EA) are pretty good at this stage at modelling how heavy rainfall will affect certain areas. They can identify with pretty good accuracy, the areas most at risk of being flooded. Where they are currently trying to improve is in using that information combined with weather forecasts to be more pro-active in responding to floods by predicting with as much foresight, where will flood and when.

What nobody is doing is mapping the indirect impact of these areas being flooded. If a hospital is flooded it has an enormous impact. Lives can be lost. In many cases it is understood who a hospital serves and where they live. That is why most hospitals have emergency plans, back-up generators and temporary flood barriers. This is nothing new.

What we are yet to fully understand is the impact that the loss of businesses and smaller infrastructure might have on the wider economy and population. 

Maybe you live on a hill and the car manufacturer you work for is located 5 miles form a flood risk area. You might feel that flooding is of no interest to you. But what if the company that supplies vital engine parts to your company gets flooded? What if the road to your factory is closed due to flooding and no parts can get in? What if your main customer gets flooded and can't buy any stock from you for several weeks? What if your electricity supplier loses a substation and your company is without electricity for several days?

Your company may not close or even get wet but it may lose a lot sales, be unable to make good on contracts, lose custom to competitors or have to lay off staff. Of course insurance is there to cover any losses but how many businesses consider those kind of risks when taking out insurance? How well do insurance companies even understand the risk that businesses or people are really at?

The answer is not very well. 

Insurance companies need to know the risk that each and every customer is at because, by their very nature, they are assuming the risk of those customers. Because of the extensive nature of floods, they can result in a huge number of claims all at the same time, putting huge strain on an insurance company.

How does this impact on you and me? Well due to competition, every insurance company wants to be able to offer the cheapest policy possible and they can only do that by reducing their own risk. Affordability is key to resilience when it comes to insurance.

The non-physical

Having recently spoken to the risk mapping manager for a leading UK and international insurer, they really don't understand what I call systemic risk at all. The reason is simple. It's too complex. Mapping critical infrastructure is easy. The EA knows where their flood defenses are. Water companies know where their treatment plants are. Likewise electricity companies and their substations.

What is more difficult is the non-physical aspects of systems. We can likely map the supply chain of an individual company with some time and effort but to do so for even a small town is beyond the capabilities of any insurance company or government agency at the moment. 

Where can we learn from in trying to do this? Can geographers collaborate with economists and business experts to start this process? Who is willing to kick start it? What are the drivers behind such an initiative?

If this information can benefit the insurance industry then perhaps that is a potential point of entry. Unfortunately by their nature, insurance companies are protective of their data and analysis techniques but maybe the benefits can be passed on to the customer. 

Can the government take this on? The recently published National Flood Resilience Review highlighted the importance of mapping infrastructure at risk of flooding which is a big step forward, if a few years behind what many in the industry have been saying for many years. Can mapping the non-physical be the next step?