FloodFlash's Mark Hara wades into US flood market

➤ FloodFlash Ltd., which has been providing parametric insurance for flooding to business customers in the U.K. since 2019, is ready to take on the U.S. market and has tasked Mark Hara to lead that effort as CEO of the insurtech's North American operations.

➤ Hara has handled marketing operations for companies such as Nationwide Mutual Insurance Co., where he helped roll out its SmartRide auto insurance program. Hara also led and successfully exited two insurtech startups, Mylo LLC and Bold Penguin Inc.

➤ While FloodFlash has started writing commercial business on a limited basis in the lower 48 U.S. states, the rollout is focused on Florida, Virginia, Texas, Louisiana and California, where the company will write policies for all sizes of business.

S&P Global Market Intelligence spoke with Hara about how FloodFlash is navigating the flood insurance landscape in the U.S. The following conversation has been edited for length and clarity.

S&P Global Market Intelligence: Other than the introduction of the product, what other steps are you taking to establish FloodFlash in the U.S.?

Mark Hara: Number one is we're enrolling our distribution partners, so we're going through brokers here in the United States, including Aon PLC, Marsh & McLennan Cos. Inc., Arthur J. Gallagher & Co. and Willis Towers Watson PLC. We're also working with flood specialists, so they only deal with flood coverage, and I'm building out the sales team that will support our broker partners. We're helping them train their staff because the product is unique, as well as the coverage that is available. Training the brokers is important but we're available to talk to their clients to help them structure appropriate coverage.

What are your first impressions of the FloodFlash rollout in the U.S.?

It's been a challenge and an opportunity at the same time. I think most people when they hear the term "parametric," they're like, "Tell me more." They're familiar with wind and earthquake products that have been around in the U.S. for a while, but they've never seen a flood product. So teaching customers about what the product is and how it works is a challenge, as well as an opportunity.

The centerpiece of FloodFlash's coverage is the mobile-connected sensors installed at the property that alert the company when a certain level of flooding is reached to start the claims process. How would that have worked in Florida in the aftermath of Hurricane Ian?

I actually live in Naples, Fla., and fortunately, I didn't have any damage, but that's not true for many people that live close by, especially along the coast. Then, as you go north of there, like Bonita Springs, and Fort Myers, Cape Coral, and those barrier islands, many of those people and businesses, unfortunately, are shut down or have slab claims. The storm happened on a Wednesday, so FloodFlash would have paid our claims out on Thursday or Friday, even though most of the people there weren't even able to see their properties for a week or two weeks. It doesn't matter where the location is. Of course, proximity to water would influence the price based on the coverage the client is requesting. But as long as there is a physical location, then FloodFlash would be a great product to consider.

What types of coverage are customers seeking from FloodFlash?

We're getting interest from or generating a lot of quotes for multifamily, apartments and condominiums. Another unique application for the product, because it's parametric, is insuring a building that's under construction, something for which National Flood Insurance Program coverage isn't available. Another area that made sense is new and used car dealerships. Because we're not insuring a specific structure, it's more about the customer wanting protection for an asset or getting coverage, if there's flooding, for a cleanup. There are some really novel uses and you can use the payout for anything. Business interruption is unique with the FloodFlash product. We've had hotels that lose business when they're down, so they could use the payout to help replace lost income and pay their staff, but also to help repair the property.

What has been the reception for the product from state regulators you've spoken with?

I think they're excited because they always want to see more coverage made available to people in their states. I've been in insurance for 20-plus years and launched numerous products, and I've always found that regulators provide great counsel and are ready to help you do new things for people in their state. Flooding is the largest peril and using FloodFlash helps bring flood insurance to people who are already eligible for it, but also to people who aren't eligible. It just helps make insurance better.