It has been a momentous Exceedance here in Miami, with a raft of new product launches, excitement around transformation in our keynotes, a sea of new insight from across over sixty track sessions, and great camaraderie from the global risk community who took the time to join us here.
So much has happened, so time for a quick recap. Our opening keynote on Tuesday saw the unveiling of five new innovations. This included the launch of RMS Risk Intelligence™, an open and flexible platform built to enable better risk management and support profitable risk selection. RMS also introduced the Risk Data Object (RDO), a new open data standard.
We looked to the future on Wednesday, with keynotes from renowned disruptive innovation expert and futurist, Daniel Burrus, to answer the question – how can organizations survive and thrive in this age of transformation? Daniel offered a simple framework to help scan the disruptive environment, to ensure an organization is a disruptor, and not just disrupted. Robert Muir-Wood and Michael Steele from RMS examined the future of risk and risk management and suggested ten future risks that the industry needs to keep a watchful eye on.
After a great birthday reception yesterday evening, with RMS celebrating thirty years in business, the time to look back had past, as the keynote sessions for day two at Exceedance were all about looking to the future. Opening the general session keynote, Karen White, chief executive officer, welcomed our guest speaker to the Exceedance stage, renowned disruptive innovation expert and futurist, Daniel Burrus. A New York Times best-selling author, Daniel’s most recent book is entitled “The Anticipatory Organization: Turn Disruption and Change into Opportunity and Advantage”.
The opening keynote at Exceedance clearly set the agenda for this year’s conference – the future of risk. Karen White, chief executive officer for RMS, in her opening address, summarized the state of the risk management industry with one of her favorite songs – it just had to be David Bowie and “Changes”. But Karen asked what’s driving these changes, how do our clients see change, and how are they responding? Karen outlined how she had travelled the globe, (and clocked up hundreds of thousands of United MileagePlus points), talking to clients to get a clear-eyed view of what has changed and what to do about it.
Karen discovered that the catalysts for change had come from a wide range of sources, from how bad surprises are becoming, how new opportunities are motivating change, and how technology is changing approaches to risk. And it is a poignant time for RMS to look to the future of risk, as we celebrate and reflect on thirty years in business this year – and the birth of the nat cat modeling industry in 1989. Change has been constant in thirty years, but is now accelerating ahead, as Karen remarked that the next five years will define the future of risk.
To everyone who is already here, or is en route to the Exceedance conference – joining us in Miami from around the world, a warm welcome awaits as the global risk management community meets once again.
There is such a buzz around Exceedance already, with a great deal of anticipation ahead of tomorrow’s keynotes – to get a first look at the latest new developments, and the kick off of our extensive track program, with seven tracks and some seventy sessions over three days. The stage is set for us to share our vision for this fast-changing industry – and how RMS can bring models, analytics, and data together to provide the risk insight that the market needs. Everyone is ready to go – including our Expert Bar team who will be on hand throughout the two main days of the conference to answer any questions that our delegates have.
With the release of version 18.1 on April 22 from RMS, there is plenty to explore, validate and put into production.
Updated Insights on North Atlantic Hurricane Risk
Starting with the RMS North Atlantic Hurricane (NAHU) Models, version 18.1 (v18.1) includes updates to the long-term and medium-term event rates throughout the Atlantic Basin, historical event reconstructions from recent seasons, and hazard and line-of-business specific vulnerability enhancements informed by new data and RMS building research.
A new wildfire season looms on the horizon across the United States, and as the last two years of huge wildfire insured losses and extensive devastation to lives and property clearly illustrates, wildfire is no longer an easily manageable loss for the (re)insurance industry – but a new peak peril.
So, what could be in store for the 2019 season? The industry is reeling from back-to-back seasons with losses over US$10 billion. This is unprecedented even during a period when average losses between 2011-2018 were at US$3.7 billion. And looking back, this is up 40x compared to 1964-1990, where losses were below US$100 million in today’s prices. What is changing with this peril, what are the risk drivers that we need to look out for?
The April release of Risk Modeler 1.11 marks a major milestone in both model science and software. For the first time at RMS, a complete high-definition (HD) model – the RMS U.S. Inland Flood (USFL) HD model with integrated storm surge, and an accompanying model validation workflow are now available to all users on the new platform. It also marks the release of exciting new capabilities including auditable exposure edits and data access via third-party business intelligence and database tools.
What is Different About Model Validation on Risk Modeler?
For the USFL model to produce detailed insights into risk, it must realistically simulate the interactions between antecedent environmental conditions, event clustering, exposures, and insurance contracts over tens of thousands of possible timelines. That requires a new financial engine, a more powerful model execution engine, and a purpose-built database to handle the processing of and metrics calculation against the vast amounts of data that an HD model produces. Although the current RiskLink solution can perform some of these tasks and processes well and efficiently, Risk Modeler was especially built for these new requirements.
In addition to simply running this next-generation model, Risk Modeler has several features to quickly surface insights into the model and ultimately allow users to make business decisions faster.