Disaster Reporting

7/31/2019 Disaster Reporting

1/27

D

isasterRepo

rting

D

isasterRepo

rting

byby

D

avidVacca,

D

avidVacca,

Sr.

FinancialAnalysis&ReceivershipManager

Sr.

FinancialAnal

ysis&ReceivershipManager

NAICFinancialRegulatoryServicesDivision

NAICFinancialR

egulatoryServicesDivision


2/27

PresentationOverview

PresentationOverview

Background

Background

ReasonsforDisasterReporting

ReasonsforDisasterReporting

Struc

turingADa

taCall

StructuringADataCall

Data

CollectionS

ystems

Data

CollectionS

ystems

NAIC

DisasterR

eportingFra

mework

NAIC

DisasterReportingFra

mework

Disas

terPrepared

ness

Disas

terPrepared

ness


3/27

Bac

kground

Bac

kground

Disasterreportin

ghastaken

placeoverthe

Disasterreportin

ghastakenplaceoverthe

yearsonnumero

usoccasions

yearsonnumerousoccasions

HurricaneAndrew

Hu

rricaneAndrew

Y2K

Y2

K

Se

ptember11,2

001terroristattacks

September11,2

001terroristattacks

Hurricanedisastersin2004and2005striking

Hu

rricanedisastersin2004an

d2005striking

GulfCoast(Katrina/Rita/Wilma)

Gu

lfCoast(Katrina/Rita/Wilm

a)

Se

veralsinglestatedisastersinvolvingfires,

Severalsinglestatedisastersi

nvolvingfires

,

flo

oding,tornad

os,earthquakes,e

tc.

flo

oding,tornados,earthquakes,e

tc.


4/27

10LargestU.S.InsuredPropertyCATLosses

10LargestU.S.InsuredPropertyCATLosses 5,

9735,973

20052005

H

urricaneRita

H

urricaneRita

7,0137,013

19891989

H

urricaneHugo

H

urricaneHugo

8,2038,203

20042004

H

urricaneCharley

H

urricaneCharley

7,8037,803

20042004

H

urricaneIvan

H

urricaneIvan

$5,043

$5,043

4,5954,595

H

urricaneFrances

H

urricaneFrances

10,993

10,993

20052005

H

urricaneWilma

H

urricaneWilma

17,485

17,485

19941994

N

orthridge,CAearthquake

N

orthridge,CAearthquake

22,006

22,006

20012001

W

orldTradeCenter,

W

orldTradeCenter,

Pentagonterroristattacks

Pentagonterroristattacks

22,902

22,902

19921992

H

urricaneAndrew

H

urricaneAndrew

$43,625

$43,625

20052005

H

urricaneKatrina

H

urricaneKatrina

Insured

Insured

Losses

Losses

YearYear

($

Millionsin2007dollars)

($

Millionsin2007dollars)

*PerISO


5/27

Reas

onsforDisaster

Reporting

Reas

onsforDisaster

Reporting

Identifyingsolvencyissuesatan

earlierdate

Identifyingsolvenc

yissuesatan

earlierdate

Identifyingmarket

conductissue

satanearlier

Identifyingmarket

conductissue

satanearlier

datedate

Colle

ctingdatatoassistpolicym

akersina

Colle

ctingdatatoassistpolicymakersina

timelymanner

timelymanner

Assis

tingconsumers,interestedparties,

Assis

tingconsumers,interestedparties,

insurers,andother

regulatorsinunderstanding

insurers,andother

regulatorsinunderstanding

exposure

exposure


6/27

Reas

onsforDisaster

Reporting

Reas

onsforDisaster

Reporting

FinancialandBankin

gInformation

Infrastructure

FinancialandBankin

gInformation

Infrastructure

Committee(FBIIC

)

Committee(FBIIC)

CharteredunderthePresident'sW

orkingGrou

p

CharteredunderthePresident'sW

orkingGrou

p

onFinancialMarkets,

onFinancialMarkets,

Chargedwithimpr

ovingcoordin

ationand

Chargedwithimprovingcoordin

ationand

comm

unicationam

ongfinancial

regulators,

comm

unicationam

ongfinancial

regulators,

enhancingtheresiliencyofthefinancialsector,

enhancingtheresiliencyofthefinancialsector,

andp

romotingthe

public/private

partnership

andp

romotingthepublic/private

partnership

Treas

ury'sAssistan

tSecretaryfo

rFinancial

Treas

ury'sAssistan

tSecretaryfo

rFinancial

Institutionschairsthecommittee

Institutionschairsthecommittee


7/27

S

tructuri

ngADa

taCall

S

tructuringADa

taCall

Activation

Activation

Single

Single--stateeven

t

stateeven

t--Activationwillbeat

Activatio

nwillbeat

thed

iscretionof

thecommissioner

thed

iscretionof

thecommissioner

Multi

Multi--stateevent

stateeventActivatio

nwilloccur

Activatio

nwilloccur

basedoncoordin

ateddiscussionsbetween

basedoncoordin

ateddiscussionsbetwee

n

commissioners

commissioners

Nosettrigger

NosettriggerNospecificdollaramount

Nospecificdollaramount

orsizeofaneventwasestab

lished

orsizeofaneventwasestablished


8/27



AuthorityandConfid

entiality

Authorit

yandConfid

entiality

Inform

ationanddata

thatisrequir

edtobesubm

itted

Inform

ationanddata

thatisrequiredtobesubm

itted

foradatacallistypicallymadepu

rsuanttothe

foradatacallistypicallymadepu

rsuanttothe

statutoryauthorityofeachparticip

atingstateun

der

statutoryauthorityofeachparticip

atingstateun

der

theirexaminationlaws

theirexaminationlaws

Thoselawstypically

providethatallinformation

Thoselawstypically

providethatallinformation

obtainedordisclosedinthecourseofan

obtaine

dordisclosedinthecourse

ofan

examin

ationareconfidentialandp

rivileged

examin

ationareconfidentialandp

rivileged

Statelawsallowfor

thesharingof

otherwise

Statelawsallowforthesharingof

otherwise

confidentialinformationwithothe

rstate,federa

lor

confidentialinformationwithothe

rstate,federa

lor

interna

tionalregulators

interna

tionalregulators

Acompany

Acompanysfailure

toreporttherequired

sfailure

toreporttherequired

informationmayresultinadministrativeaction

informationmayresultinadministrativeaction

takenb

yaregulator

takenb

yaregulator


9/27



SECRegulationFD(R

eg.

SECRegulationFD(R

eg.

243.100)

243.100)FairDisclo

sure

FairDisclo

sure

Providesthatwhena

ninsurerdisc

losesmaterial

Providesthatwhena

ninsurerdisc

losesmaterial

nonpublicinformationtocertain

nonpub

licinformatio

ntocertaine

numerated

enumeratedpersons,

persons,

itmust

makepublicdisclosure

itmust

makepublicdisclosure

SECH

ighlightedthr

eestepprocess

SECH

ighlightedthreestepproces

s

1)Assessmateriality

;

1)Assessmateriality

;

2)Assesswhetherdisclosurewasmadetoenumerated

2)Assesswhetherdisclosurewasmadetoenumerated

person(e.g.brokerd

ealer,investmentadviser,investment

person(e.g.brokerd

ealer,investmen

tadviser,investment

company,holderofsecurity);and

company,holderofsecurity);and

3)Ensurerecipiente

xpresslyagrees

tomaintain

3)Ensurerecipiente

xpresslyagrees

tomaintain

confidence.

confidence.

Rule100(b)(1)statesitshouldnotinterferewith

Rule100(b)(1)statesitshouldnot

interferewith

communicationstog

overnmentag

encies

commu

nicationstog

overnmentag

encies


10/27

S

tructuri

ngADa

taCall

S

tructuringADa

taCall

PossibleReporting

Phases

PossibleReporting

Phases

Claimsbyterrito

ryandfinan

cial

Claimsbyterrito

ryandfinan

cial

proje

ctions

proje

ctions

Generalinformation

Generalinformation

Line

ofbusiness

reporting

Line

ofbusiness

reporting

Generalclaimsa

djudication

andaging

Generalclaimsa

djudication

andaging

Polic

yactivitydata

Polic

yactivitydata


11/27

S

tructuri

ngADa

taCall

S

tructuringADa

taCall

PossibleReporting

PhasesforP&C

PossibleReporting

PhasesforP&C

Phas

eI

PhaseI--Claims

byterritory

andfinancial

Claims

byterritory

andfinancial

proje

ction

proje

ction

Phas

eI

PhaseI--Generalinformation

Generalinformation

Phas

eII

PhaseII--Lineo

fbusinessreporting

Lineofbusinessreporting

Phas

eIII

PhaseIII--Generalclaimsad

judicationa

nd

Generalclaimsad

judicationa

nd

aging

aging

Phas

eIV

PhaseIV--Policyactivityda

ta

Policyactivityda

ta


12/27



PhaseI

PhaseI--Claimsbyterritoryandfina

ncialprojections

Claimsbyterr

itoryandfinancialprojections

andgen

eralinformation

andgen

eralinformation

Numberofclaimsestimated(modelingprogram

or

Numberofclaimsestimated(modelingprogram

or

portfoliounderwritin

g)

portfoli

ounderwriting)

Numberofclaimsreportedtodate

(possiblebycounty

Numberofclaimsreportedtodate

(possiblebyc

ounty

orzip)

orzip)

Totaldollarspaidtopolicyholders

Totaldollarspaidtopolicyholders

Bestestimateofexpe

ctedgrossloss

Bestestimateofexpe

ctedgrosslos

s

Bestestimateofnetr

etention

Bestestimateofnetr

etention

Locatio

n,contactinformationandhoursofoperation

Locatio

n,contactinformationandhoursofoperation

formob

ileresponseunits

formob

ileresponseu

nits

Contactinformationforindividual

responsiblefor

Contactinformationforindividual

responsiblefor

submittingtheinform

ation

submitt

ingtheinform

ation


13/27



PhaseII

PhaseII

Lineofbu

sinessreporting

Lineofbu

sinessreporting

Numberofclaims

reportedby

lineofbusiness

Numberofclaims

reportedby

lineofbusiness

Numberofclaims

estimatedbylineofbus

iness

Numberofclaims

estimatedbylineofbus

iness

(based

onmodelingprograms

andportfolio

(based

onmodelingprogramsandportfolio

underw

riting)

underw

riting)

Totalc

laimspaym

entsmadetopolicyhold

ers

Totalc

laimspaym

entsmadetopolicyhold

ers

byline

ofbusiness

byline

ofbusiness

Bestestimateofexpectedgros

slossbylin

eof

Bestestimateofex

pectedgros

slossbylin

eof

business

business


14/27



PhaseIII

PhaseIIIGeneralclaimsadjud

icationandaging

Generalc

laimsadjud

icationandaging

Totaln

umberofadjustedclaim

s

Totaln

umberofadjustedclaim

s

Averagenumbero

fdaystoclo

seclaims

Averagenumbero

fdaystoclo

seclaims

Numberofclaims

closedwith

nopayment

Numberofclaims

closedwith

nopayment

made

made

Numberofclaims

closedwith

paymentmade

Numberofclaims

closedwith

paymentmade

Numberofclaims

inwhichlitigationis

Numberofclaims

inwhichlitigationis

involvedoralterna

tivedispute

resolutions

involvedoralterna

tivedispute

resolutions

Numberofclaims

openformo

reXXdays

or

Numberofclaims

openformo

reXXdays

or

more,butlessthan

XXdays

more,butlessthan

XXdays


15/27



PhaseIV

PhaseIVPolicyactiv

ityinformatio

n

Policyactivityinformatio

n

Policiesinforceatpriorandcurrentquarter

Policiesinforceatpriorandcurrentquarter--end

by

end

by

lineofbusiness

lineofbusiness

Policiesrenewedinc

urrentquarterbylineofbusiness

Policiesrenewedinc

urrentquarter

bylineofbusiness

Policiesnon

Policiesnon--renewed

incurrentqu

arterbylineo

f

renewed

incurrentqu

arterbylineo

f

busines

s

busines

s

Policiescanceledincurrentquarterbylineofbu

siness

Policiescanceledinc

urrentquarterbylineofbu

siness

Newpo

licieswritten

incurrentquarterbylineof

Newpo

licieswritten

incurrentquarterbylineof

busines

s

busines

s


16/27



Considerationswith

ReportingR

equirements

Considerationswith

ReportingR

equirements

Freque

ncy

Freque

ncyWillbestructuredinawayth

atis

Willbestructured

inawayth

atis

reflectiveofthepe

riodofthetimewhenth

e

reflectiveofthepe

riodofthet

imewhenth

e

dataw

ouldbeavailable

datawouldbeavailable

Duration

DurationWillbe

structuredinawayto

Willbe

structuredinawayto

complementeachotherandno

tcreatean

complementeachotherandno

tcreatean

unforeseenburden

oninsurers

unforeseenburden

oninsurers


17/27

DataCol

lectionSystems

DataCollectionSystems

Goalsof

AnyDataC

ollectionSy

stem

Goalsof

AnyDataC

ollectionSy

stem

Technicalarchitectureofanydatacollection

Technicalarchitectureofanyd

atacollection

system

willusuallyprovideforthefollowing:

system

willusuallyprovideforthefollowing:

UserUser

--friendlydata

submission

friendlydata

submission

Auto

mateddatavalidation

Auto

mateddatavalidation

Flexibledatarepositoryandmaintenanceabilities

Flexibledatarepositoryandmaintenanceabilities

Func

tionalanalyticaltools/reportingabilities

Func

tionalanalyticaltools/reportingabilities


18/27

N

AICDis

asterReporting

N

AICDis

asterReporting

Framework

Framework

DisasterReportingW

orkingGroupoftheFinancial

DisasterReportingW

orkingGroup

oftheFinancial

Condition(E)Comm

itteewascrea

tedinlate2005to

Conditi

on(E)Comm

itteewascrea

tedinlate2005to

develop

aframework

thatwouldguidestateinsu

rance

develop

aframework

thatwouldguidestateinsu

rance

departm

entsoninitia

tingacoordin

ateddisaster

departm

entsoninitiatingacoordin

ateddisaster

reportin

geffort

reportin

geffort

Chair

Chair--

Commissione

rKevinMcCarty(FL)

Commissione

rKevinMcCarty(FL)

GuidanceinFrameworkismeanttobeadvisory,rather

GuidanceinFrameworkismeanttobeadvisory,rather

thanto

prescribeman

datoryregula

toryprocedur

es

thanto

prescribeman

datoryregula

toryprocedures

AdoptedbyEComm

itteeduringD

ecember2007and

AdoptedbyEComm

itteeduringD

ecember2007and

Executive/Plenarydu

ringMarch2008

Executive/Plenarydu

ringMarch2008


19/27

N

AICDis

asterReporting

N

AICDis

asterReporting

Framework

Framework

Frameworkprovides

guidanceon:

Frameworkprovides

guidanceon:

Comm

unicationm

ethods

Comm

unicationm

ethods

Forum

sfordiscussingandcollaborating

Forum

sfordiscussingandcollaborating

betweenstatesand

interestedp

arties

betwee

nstatesand

interestedp

arties

Electronicapplicationsthatcanbeused

Electro

nicapplicationsthatcanbeused

Structuringthedatacall,includingdata

Structu

ringthedat

acall,includingdata

elements

elemen

ts

PossibleroleofNAIC

PossibleroleofNAIC


20/27

N

AICDis

asterReporting

N

AICDis

asterReporting

Framework

Framework

Coordinateddisaster

reporting:

Coordinateddisaster

reporting:

Enhancestheregulatoryprocessbysharing

Enhancestheregulatoryprocessbysharing

resourcesamongfellowstates

resourcesamongfellowstates

Reducingduplicativerequests

toinsurers

Reducingduplicativerequests

toinsurers

Provid

ingkeydata

forsolvenc

yandmarket

Provid

ingkeydata

forsolvenc

yandmarket

regulationresponsibilities

regulationresponsibilities

Provid

ingconsiste

ntassistancewithintere

sted

Provid

ingconsistentassistancewithintere

sted

parties

parties


21/27

N

AICDis

asterReporting

N

AICDis

asterReporting

Framework

Framework

Possible

NAICroles:

Possible

NAICroles:

Facilitateaforumtodiscussandcollabora

te

Facilitateaforumtodiscussandcollaborate

Assist

inthecomm

unicationo

fadisaster

Assist

inthecomm

unicationofadisaster

reportingeffort

reporti

ngeffort

Design

,developandsupporttechnicalsolutions

Design

,developandsupporttechnicalsolu

tions

Provid

etechnicalandpracticalresource

Provid

etechnicalandpracticalresource

solutio

ns,suchasaHelpDesk

,toallowstates

solutio

ns,suchasaHelpDesk

,toallowstates

tofocu

stheirresourcesoncon

sumerassistance

tofocu

stheirresourcesoncon

sumerassistance


22/27

Disaster

Preparedness

Disaster

Preparedness

StateD

isasterResponsePlan

StateD

isasterResponsePlan

Handbook

Handbook

serves

asaguideforstateinsu

ranceregula

tors

serves

asaguideforstateinsuranceregula

tors

asthey

developan

dadoptcom

prehensive

asthey

developandadoptcom

prehensive

disaste

rresponsep

lans

disaste

rresponsep

lans

CatastropheComp

uterModelHandbook(New

CatastropheComp

uterModelHandbook(New

Versio

nin2009)

Versio

nin2009)

Exploresin

somedetail

Exploresin

somedetail

catastrophecompu

termodels

catastrophecompu

termodels

GovernmentAccountabilityO

fficeReport

GovernmentAccountabilityOfficeReport

Greate

rTransparencyandOve

rsightofWind

Greate

rTransparencyandOve

rsightofWind

andFloodDamageDeterminationNeeded

andFloodDamage

DeterminationNeeded


23/27

Disaster

Preparedness

Disaster

Preparedness

CATRis

kModelDiscussions

CATRis

kModelDiscussions

Shortcomingsofcomputersim

ulationmod

eling

Shortcomingsofcomputersim

ulationmod

eling

Prop

rietarynature

ofmodelsmakesverificationand

Prop

rietarynature

ofmodelsma

kesverificationand

valid

ationbyregulatorsimpossible

valid

ationbyregulatorsimpossible

100%

credibilityisassumedby

manyinsurers

100%

credibilityisassumedby

manyinsurers

Lack

ofdataform

odeling

Lack

ofdataform

odeling

Mod

elsinuseproducedrasticallydifferentre

sults

Mod

elsinuseproducedrasticallydifferentresults

Limitedunderstan

dingofuniqueelementsof

Limitedunderstandingofuniqueelementsof

certa

indisasters

certa

indisasters


24/27

Disaster

Preparedness

Disaster

Preparedness

Florida

FloridasPublicCatastropheMo

del

s

PublicCatastropheMo

del

Floridahasfunded

andcommissionedaPublic

Floridahasfunded

andcommi

ssionedaPu

blic

Catastrophemodel

Catastrophemodel

Notdrivenbypoliticalpressur

e,testresultsnot

Notdrivenbypoliticalpressur

e,testresultsnot

necessarilythelow

estlevelof

losses

necessarilythelow

estlevelof

losses

WillbeAvailableforPublicU

seshortly

WillbeAvailableforPublicU

seshortly

NoNoBlackBox

BlackBox

Areferenceforreg

ulators

Areferenceforreg

ulators


25/27

Disaster

Preparedness

Disaster

Preparedness

NAICNaturalCatastrophePlan

NAICNaturalCatastrophePlan--CatastropheInsu

rance

CatastropheInsurance

(C)Wo

rkingGroup

(C)Wo

rkingGroup

Thecurrentplanhas

severallayers

andisdesign

ed

Thecurrentplanhasseverallayers

andisdesign

ed

followingseveralguidingprinciples:

followingseveralguidingprinciple

s:

Anationalprograms

houldpromotepersonalrespons

ibility

Anationalprogramshouldpromotep

ersonalrespons

ibility

amon

gpolicyholders;

amon

gpolicyholders;

Anationalprograms

houldsupportreasonablebuilding

Anationalprogramshouldsupportre

asonablebuilding

codes,developmentp

lans,andothermitigationtools;

codes,developmentp

lans,andothermitigationtools;

Anationalprograms

houldmaximize

therisk

Anationalprogramshouldmaximize

therisk--bearing

bearing

capacityoftheprivat

emarkets,and;

capac

ityoftheprivatemarkets,and;

Anationalplanshouldprovidequantifiablerisk

Anationalplanshouldprovidequantifiablerisk

mana

gementtothefe

deralgovernme

nt.

mana

gementtothefe

deralgovernme

nt.

ExposedonNAICwebsite:

ExposedonNAICwebsite:

http://www.naic.org/committees_c_c

atastrophe.htm

http://www.naic.org/committees_c_c

atastrophe.htm


26/27

Disaster

Prepare

dness

Disaster

Prepare

dness

OtherCa

tastropheProposals

OtherCa

tastropheProposals

TaxTax--deferredcatas

trophereser

ves

de

ferredcatas

trophereser

ves

AllAll--perilspolicy

perilspolicy

Federa

lreinsuranc

eproposals

Federa

lreinsuranceproposals

Catastrophesavingsaccounts

Catastrophesaving

saccounts

Favora

bletreatmentofcatbon

ds

Favora

bletreatmentofcatbon

ds


27/27

Qu

estions?

Qu

estions?

Disaster Reporting

Documents