The Standard Formula methodology for the Flood and Hail scenarios (Art. 123 and 124 of the Delegated Regulation, respectively) uses the sum insured as input to the estimation of expected losses for a 1-in-200y event. The factors applied to motor sum insured for a given risk zone do not render an assumption of the losses being larger than the sum insured.

The reason for the introduction of these factors is that the damage ratio for a given flood or hail event is on average higher for motor than for property: The economic loss from flood or hail events is likely to be higher for a car than for a house. For the former the repair costs may easily be higher than the repurchase costs (e.g. due to water ingress or severe hail hits).  

The structure of the Standard formula is such that a single country factor is provided per scenario. For flood and hail, the country factor provided is basically a property-related country factor.

 In order to avoid an additional, different country factor per flood/hail scenario for motor, but in order to nevertheless account for the differences in damage ratios at the 1-in-200y level when including motor LoB, it was decided to introduce the factor at the zonal level sum insured instead.