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Aon
Corporation is advising all risk management providers
to keep their eye on the sky. The National Oceanic and Atmospheric
Administration (NOAA) are forecasting a high number
of named storms for the 2008 Atlantic hurricane
season which starts June 1 and lasts until November
30th and includes tropical storms and hurricanes.
Due
in part to the relatively small number of hurricanes and tropical storms to hit
landfall in the last two years, Aon Re Global predicts better pricing for traditional
property catastrophe reinsurance programs.
Nonetheless, "while
predictions of hurricane activity are important, insurance and reinsurance
buyers must remember that any storm can cause massive destruction, whether that
storm occurs in a season of above-normal activity or below-normal
activity," explains Steven Drews, lead meteorologist and associate vice
president of Impact Forecasting LLC, a unit of Aon Re Global. "Hurricane
Andrew in 1992 and hurricanes Dean and Felix in 2007 each caused massive
destruction -- during periods of relatively light activity."
Al Tobin, managing
director and leader of Aon's property practice, advises that businesses develop
plans to protect employees and property. He also recommends that policy owners
understand what is and is not covered in their policy, such as wind damage, and
how soon the policy will respond to damages.
Minimizing the impact on
business is critical when planning for tropical storms and hurricanes. "We advise our clients
to focus on how best to protect their people, property and data, as well as
the ability to communicate," said Tobin. "Also, we urge clients to procure generators, temporary
employee housing and restoration services before or early in the hurricane
season, as such services are often difficult to get after a storm
hits."
"Organizations may
become complacent in their loss-mitigation planning if they haven't experienced a
property loss in some time," adds Arnold Mascali, president of Aon Horizon and Aon Global Rapid
Response. "Such complacency can leave them vulnerable to significant losses
if
catastrophes strike their facilities while
they're not adequately prepared."
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