Assessment of corporate financial flood risks due to property damage and business interruption loss

This study sought to quantify the financial impact of floods due to corporate property damage and BIL by integrating facility-level business databases, parameters related to property damage and BIL caused by floods, and outputs from hydrological analyses. The models proposed here, and tested on four Japanese companies, addressed the research need for integrating data at the facility level, and relating flood risks to financial metrics.

The findings of this analysis could provide crucial support for organizations in benchmarking their specific climate-related financial risks. This information is critical for corporations to make informed investment decisions regarding risk management strategies, such as constructing flood barriers for facilities, elevating critical equipment like power systems or acquiring flood insurance. Insurers may utilize their financial assessments of flood risk to determine premiums reflecting regional differences