Pushing boundaries with satellite technology
ICEYE’s Kohei Watanabe on how Japan’s 2017-18 floods have provided lessons on how satellite technology can enhance the response to major events.
In 2017 and 2018, Japan experienced a series of devastating floods which caused widespread damage to multiple different prefectures and significant loss of life.
In the aftermath, Tokio Marine & Nichido Fire Insurance Co (TMNF) conducted a detailed analysis of its response to these events. Its flood damage assessment capabilities relied heavily on traditional, ground-based methods which, given the nature of flood losses, were resulting in significant delays in claims payments. These delays were in turn negatively impacting the overall customer experience.
The company has long recognised the value of integrating leading-edge technology into its insurance ecosystem, actively collaborating with insurtech companies to unlock the immense potential of such partnerships to enable the development of new products and innovations within its operations.
To enhance its flood response capabilities, TMNF therefore focused on satellite technology. While recognising the potential that Earth observation capabilities provided, TMNF also acknowledged the limitations of such technology, including the inability to capture flood imagery through clouds and at night and also uncertainty regarding the speed and frequency of image acquisition.
In 2020, it began collaborating with ICEYE, operator of the world’s largest radar satellite constellation and a global provider of hazard data. What made its offering viable was that its synthetic aperture radar technology could pierce cloud cover. Further, by applying proprietary algorithms and pooling auxiliary data sets, the company was able to provide TMNF with high-resolution data on the extent and depth of flood water at the individual building level.
TMNF was a pioneer in the adoption of satellite technology for flood analysis. It worked hand-in-hand with the team at ICEYE to establish the most effective way of integrating the new capability into its flood response ecosystem.
Junichiro Fujiki, manager at TMNF, said: “We saw the application of this flood insight as a critical component in our ability to fulfil our responsibility as an insurance company, to provide peace of mind to our customers in the event of any disaster.”
The successful implementation of satellite-enabled flood insights into its response ecosystem has seen TMNF restructure its operational practices for flood events. For example, the rapid access to high-resolution data that accurately shows flood inundation levels at individual buildings now enables it to conduct remote damage assessments as the event is evolving, minimising the need for third-party adjusters to conduct on-site assessments.
The data that TMNF now receives whenever a major flood develops anywhere in Japan is much more granular than was previously possible. For example, in the case of the flooding from Typhoon Nanmadol in September 2022, TMNF was already receiving flood analysis before the flood waters had peaked, and within days had a detailed understanding of how many buildings in the affected areas had been flooded, as well as the severity of that flooding.
With such data available in near real time for flood events, the company has been able to enhance multiple aspects of its response capabilities, including reducing overall claims costs and expediting claims settlements – which ultimately combine to deliver a much better customer experience at a time when those affected are facing multiple immediate challenges.
However, the potential that satellite data offers does not stop there for TMNF and its work with ICEYE. “We see this not only contributing to the insurance claims process,” Fujiki added, “but it also has wider societal impacts, such as supporting lifesaving and rapid recovery efforts in disaster-prone regions throughout Japan, where natural disasters occur frequently.”
The strategic alliance that has been established between TMNF and ICEYE is clearly set to push the boundaries of what satellite capabilities can deliver to the insurance industry and for the wider management of natural catastrophes.
Kohei Watanabe is strategic account manager APAC at ICEYE