New RMS Solution Will Give Underwriters Real-Time, Site-Specific Insights For More Competitive Risk Selection and Pricing
Location Intelligence API will offer best-in-class hazard, risk and loss metrics from RMS model science at the location level, ensuring a consistent view of risk from underwriting up to portfolio management
LONDON, U.K. -
October 02, 2017 -
RMS, a global risk modeling and analytics firm, has introduced a new solution enabling underwriters to access critical information about any location globally, within seconds, in order to gain competitive advantage in risk assessment. The new API, or application programming interface, will link insurers’ underwriting systems with the most sophisticated hazard, exposure and loss data derived from RMS modeling.
Chris Folkman, senior director, RMS model product management, said: “In today’s soft market, underwriting discipline is vital. Insurers can’t afford to make improper pricing assumptions or inappropriate declinations. The best risk selection relies on the most accurate risk intelligence – and that’s what this new tool enables in fractions of a second. It provides straightforward insight that is rooted in the world’s best catastrophe risk modeling, at a speed which is fast enough to feed even real-time quoting portals.”
The RMS Location Intelligence API provides a step-change in the ability to understand risk at a particular site, and to select and price accordingly, whether this be seismic risk, slope, soil, flood zone or building attributes. This allows insurers to avoid or cede risks that don’t meet their risk appetite, expand into new territories with confidence, and thus optimize their book of business.
Eventually RMS will offer this service across its full range of more than 190 models, reflecting the principal perils in key markets. Currently data is available for:
U.S. hurricane: loss costs and risk scoring
U.S. earthquake: loss costs and risk scoring
European flood (13 countries): hazard data
In late 2017, this will be extended to include:
High resolution U.S. flood hazard data
Enhanced FEMA flood zone data
Distance-to-coast, fault, and sinkhole metrics
RMS has distilled the multiple terabytes of big data simulations of catastrophic events into pre-compiled loss costs that can be obtained by underwriting teams in an instant, simply by submitting an address or coordinates, with the option of additional details on key building attributes. This enables unprecedented granularity in risk selection and pricing. Modeling insights can now be gained to inform rapid underwriting decisions, during which there is insufficient time to run a catastrophe model.
Because the Location Intelligence API draws upon the extensive resources behind RMS’ market-leading model science, clients also benefit from a single view of risk across their business; ensuring consistency from underwriting through portfolio management, where decisions are made about capital reserves and reinsurance purchase.
“For years, RMS has been a leader in portfolio management solutions for catastrophe risk. The wealth of big data generated by a model run can also provide valuable insights at the point of underwriting,” said Folkman. “We’re now opening up those insights to parts of our clients’ business which don’t rely on frequent use of catastrophe models.”
Technical overhead and cost using the Location Intelligence API are minimized, because this cloud-based solution can seamlessly integrate into existing workflows. It interfaces with underwriting applications, agency portals, or even simple spreadsheets, meaning no additional infrastructure is required.
RMS solutions help insurers, financial markets, corporations, and public agencies evaluate and manage catastrophe risks throughout the world. We lead an industry that we helped to pioneer—catastrophe risk modeling—and are delivering models, data, and risk management solutions on the RMS(one)® platform to transform the world’s understanding and quantification of risk through open, real-time exposure and risk management.
More than 400 insurers, reinsurers, trading companies, and other financial institutions trust RMS solutions to better understand and manage the risks of natural and human-made catastrophes, including hurricanes, earthquakes, floods, terrorism, and pandemics.