A statistical analysis of insurance damage claims related to rainfall extremes

In this paper, a database of water-related insurance damage claims related to private properties and content was analysed. The aim was to investigate whether the probability of occurrence of rainfall-related damage was associated with the intensity of rainfall. Rainfall data were used for the period of 2003–2009 in the Netherlands based on a network of 33 automatic rain gauges operated by the Royal Netherlands Meteorological Institute. Insurance damage data were aggregated to areas within 10-km range of the rain gauges. Through a logistic regression model, high claim numbers were linked to maximum rainfall intensities, with rainfall intensity based on 10-min to 4-h time windows. Rainfall intensity proved to be a significant damage predictor; however, the explained variance, approximated by a pseudo-<i>R</i>² statistic, was at most 34% for property damage and at most 30% for content damage. When directly comparing predicted and observed values, the model was able to predict 5–17% more cases correctly compared to a random prediction. No important differences were found between relations with property and content damage data. A considerable fraction of the variance is left unexplained, which emphasizes the need to study damage generating mechanisms and additional explanatory variables.