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Saturday, May 2, 2015

flood insurance - revolutionary jacks that lift the property automatically !!

In India,  coverage against ‘fire peril’is under Standard Fire Policy. Contrary to common belief, a Fire insurance policy offers indemnity not only against fire but against certain other specified perils as well. The term Fire for the purpose of a policy has a wider meaning that that ordinarily associated with the word fire.   Under the Policy the peril group : VI. Storm, Cyclone, Typhoon, Tempest, Hurricane, Tornado, Flood and Inundation (termed STFI perils) has been a bone of contention.

The Policy provides for indemnity of destruction or damage to the property insured caused by storm, cyclone, typhoon, tempest, hurricane, tornado, flood or inundation excluding those resulting from earthquake, volcanic eruption or other convulsions of nature. As could be seen there are two set of perils : wind and water. Storm, cyclone, typhoon, tempest, hurricane, tornado are all variants of wind blowing at different speeds and at different regions. Flood and inundation are water perils.  Though it is not  overtly stated on the Policy, the obvious reference for determining whether the wind that caused destruction would fall within the ambit is reference to ‘beaufort scale’ which is an empirical measure for describing wind speed.  Its full name is Beaufort Wind Force Scale; created by Sri Francis Beaufort, a British Admiral and Hydrographer in 1806. Thus strong or gale winds would not be within the ambit of the policy but only damages caused by winds of speed over 89 kmph or 55 mph.

Flooding can happen anywhere, but certain areas are more  prone to serious flooding, due to their geographical location – lying in low areas or closer to water bodies.  In Western World, there are  flood maps created showing  the locations of high-risk, moderate-to-low risk and undetermined-risk areas – Insurers evaluate the risk based on their own studies, experience and such maps.  The areas of higher probability may be insured  at higher rates, differential terms, increased excess or declined to be insured !!   By some yardstick – there are areas that have 1% annual chance rated on the 100 year flood experience.  There are moderate risk areas, high risk areas and even areas where the probability is 0.2% based on 500 year empirical data ! In high-risk areas, there is at least a 1 in 4 chance of flooding during a 30-year mortgage.

B u t – in insurance as also in life, even ‘no flood-hazard area’ there could be flood damage.  There are areas in Andhrapradesh  so dry that people have been struggling for their daily needs of water – but when there were spate in a river flowing far away – arising out of fear that some villages could be inundated, some intentional breaches were made, which changed the course of water and the dry villages were submerged causing death of cattle and large-scale damage. 

When Insurers analyse the risk, especially in respect of risks inspected, they would seek risk improvement measures – which would include ways of stagnation management, keeping the floor areas higher, storing important stocks at a raised level, providing dunnage, keeping them on steel racks, stacking them on raised racks and the like.  – ever thought of raising the building itself ? here is an interesting read from MailOnline of a Billionaire  who is fitting hydraulic stilts that will keep his new  £4million mansion safe from rising sea levels... and it heats itself using the outside AIR  in temperatures as low as -25C

Jim Ratcliffe is the founder and chairman of chemical giant Ineos. The Swiss-based billionaire said the house would be his only UK home. The house features several revolutionary energy saving measures.  The home's heating and hot water systems all use renewable energy  ~and that is not all !!  Reports state that the billionaire tycoon wants planning authorities to grant permission for his new £4 million beachfront mansion which can jack itself up in the case of flooding which heats itself using the outside air in temperatures as low as -25C. 

The 62-year-old businessman who is based in Switzerland claims that the new house, if built, will be his only UK residence.  The proposed beach house in this computer generated image would only be visible from yachts on the Solent.  The high-tech planned mansion will be virtually 'carbon-zero' and uses renewable energy such as solar power.  The planning application claims the building will be 'climate-change proof due to its jacking system.

The building has been designed by Charles Morris, who was the architect responsible for the Orchard Room at Prince Charles's Highgrove Estate. According the document: 'The development proposals incorporate domestic-scale micro renewable energy systems, including an array of photovoltaic cells, solar hot water and an air source heat pump.   'The solar thermal hot water system provides hot water powered directly from the sun; the photovoltaic cells will provide electrictiy to power immersion heaters to ensure that there is hot water in all weather conditions. 'The air source heat pump will draw latent heat from the air even when air temperature is as low as -25C to heat the house via underfloor heating.

The house has a revolutionary jacking system which can lift the property up in the case of flooding  !!  'The dwelling has been designed to be lifted by 73 piston jacks, with a capacity to lift 25 tonnes; this will allow the development to respond to rising sea levels over the next 100 years, this is truly innovative and truly unique.'

Mr Ratcliffe is seeking to demolish the existing house on the site and replace it with the new mansion. His neighbours include Dire Straits lead singer Mark Knopfler and the band's bass guitarist John Illsley who live either side of the planned development. His  neighbour Frank Woodward, 89, who lives 100 metres away from the beach house said: 'This area was flooded a few years ago so I think it's a good idea.

Interesting indeed !!

With regards – S. Sampathkumar

23rd Apr 2015.

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