How can new models help minimize the costs of flooding?

The challenge

The total value of assets under flood risk in the UK is estimated to exceed £200bn, and since 2000 insurers have paid out £4.5bn to customers whose homes or businesses have been hit by flooding (up 200% on the previous decade in real terms). One in six homes in England is currently at risk of flooding, and nearly 500,000 people face a significant flood risk.

There is an urgent for improved flood models that can help government target flood defence schemes more effectively, and insurers price risk more efficiently.

The solution

In the 1990s Professor Paul Bates and colleagues started to develop a new approach that favoured simplicity over complexity, using the minimum physics required to allow the model to run on the finest grid possible over the biggest area. Paradoxically, and crucially, they were able to prove that this improved the model’s predictive skill.

After more than a decade of research, and with support from Willis Re and NERC, he and his colleagues have moved the LISFLOOD-FP model forward, building a blueprint for both academic and commercial code developers and saving industry years of developer time.

Clones of LISFLOOD–FP have been used by high-impact engineering and risk management consultancies such as JBA Group to produce the national flood map for the Environment Agency showing the predicted 1 in 1000 year flood outline, RMS Ltd to conduct risk analysis for the global insurance and re-insurance industries, and Ambiental for generating flood mapping tools used by the international insurance industry.

Resulting benefits

The LISFLOOD-FP has served as a blueprint and proof of concept for the multi-million pound flood risk management industry that impacts tens of millions of people annually.

Awarding the 2012 Lloyds Science of Risk Prize, Dr Richard Ward, CEO of Lloyds, said: "The judging panel comprising experts from academia and insurance felt Professor Bates's paper was very exciting and may lead to a step change in flood modelling.”

Future directions

Professor Bates has recently received an award to accelerate the impact of his research as part of a pilot funding scheme from NERC. This award will support the commercialisation of flood risk products for insurance markets.