Protecting your business from floods

According to the 2024 Global Risks Report, produced by the World Economic Forum in partnership with Zurich, environmental risks dominate the risk landscape. When it comes to extreme weather events, floods are most common.

From 1980 to 1999, there were approximately 1 389 major floods globally. From 2000 to 2019, there were around 3 254, and hundreds of millions of people are affected each year. They can happen almost anywhere and areas that haven’t seen floods for decades, even centuries can turn into lakes in a matter of minutes.

It becomes of great importance to have flood exposure as one of the pot criteria when selecting sites for new projects such as greenfield, or when acquiring new companies. We recommend our clients to always liaise with Zurich Resilience Services (ZRS), who can provide data, insight and advice when selecting a site.

Even for regions far from rivers, not typically thought as flood exposed, it important to keep in mind that there are other types of flood risk:

• Pluvial with flash floods and surface water. There are factors such as increased urbanization and artificialization of soils with asphalt or concrete that contribute to increased pluvial flood risk. Such flash floods have impacted Sweden and Denmark in the past few years for example.
• Coastal floods often referred as storm surge are becoming an increased risk due to climate change and rising sea levels.

In general, Europe and especially Nordics who were considered as rather calm are now facing significantly increased flood exposure. It’s therefore important to regularly check available information and adapt. We have for example seen recently claims in areas that were not considered as flood exposed until a few years back.

Here are some points to reflect about, when thinking about flood risk:

Are your premises in danger?

Severe flooding is impacted by climate change but also management of waterways and infrastructure, as well as increased urbanization. It important that businesses develop and implement mitigations to minimize the risk and severity of damages. These are some hazards to consider:

• The site is in a flood zone with a short return period i.e., a high probability of being exceeded. Water bodies such as rivers, streams, creeks, lakes, bays, seas or even dry riverbeds are located nearby.
• The site elevation above the nearby water bodies is relatively low.
• High hazard is assumed if buildings or the site are less than three meters above a body of water.
• The site or nearby area has experienced flooding in the past.
• The area or the site has experienced overwhelming of gutters and drainage systems leading to surface flooding.
• Increased development in the region since facilities were built on the site.
• A high percentage of assets located at the part of the site that would be flooded.

How to lessen the risk

Basements

Identify below-ground structures that could be inundated by flooding and develop flood protection measures. Factors to consider:

• Move valuable or production-critical equipment to higher levels.
• Identify which material and portable equipment must be relocated if flooding is expected, in accordance with flood monitoring and warning systems.
• Define septic tanks, sewage lines, etc., through which flood water can backflow into the buildings or site and install backflow prevention valves.
• Utilize mobile protection features and actions for basement and ground floor areas at risk from flooding. These may include backflow prevention valves, gates and pumps, bulkheads, locating key control and electrical systems up to 50 cm above expected water levels, raising or protecting stock and machinery, tank anchors, etc.
• Use more resilient building materials and good general condition and maintenance of building elements to render property more resilient to flooding. Consider tightening the fittings and checking the seals of doors and windows.

Building exteriors

Inspect roof panels, gutters, waterproofing systems, roof-mounted equipment anchorages, conditions of eaves, etc., as part of the building’s regular maintenance. Consider these factors:

• Wind damage can lead to tear-off of roof panels and exposure of building contents to rain damage. Regular inspection and maintenance of roofs will also reduce the likelihood of water damage.
• Ensure that building contents are protected when conducting any activities, such as pressure testing of drainage pipes.
• Ensure that roof and site drainage systems have been designed according to local design codes, with special attention to local rainfall intensity-duration-frequency parameters.

Protecting equipment and goods

Building contents exposed to floodwater have varying degrees of vulnerability. Often, it is not the water alone that damages or destroys the inventory or machinery, but also the debris and the silt that come with the water. Flood water is far from clean — it typically will include sand, silt, dirt or worse still, contamination from other sites that have flooded. Even after a flood, risk lurks. Moisture may linger long-term, ultimately damaging equipment that had escaped the flood itself undamaged. If sensitive equipment is identified in an area prone to flooding, consider:

• Replacing sensitive equipment with flood-resilient counterparts, if available.
• Adding protection measures for sensitive equipment to the flood contingency plan.
• Moving the equipment to safe locations temporarily or if possible, permanently.
• Improving the flood resilience of buildings, or parts of buildings, that contain sensitive goods or critical equipment, especially the layout and the organization of critical production areas and warehousing operations.

 

As a conclusion we can have in mind the following take aways when dealing with flood risk:

Avoidance: incorporate flood risk into your planning (acquisition and new locations).

Education: increase risk awareness within your organization and be prepared.

Adaptation: prepare and regularly update your response plan: list actions to take before, during and after a flood.

Mitigation: build resistance through maintenance, physical flood protection implement recovery measures to reduce residual risks.

Collaboration: liaise with Zurich Resilience Solutions – we can provide tools and advice on climate change related risks.

 

 

For more information about how Zurich can help your company build resilience, please contact Claude Zambeaux, Underwriter Property.