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.
Facing these future challenges, and channeling another favorite – “Game of Thrones”, Karen argued that it could feel as if “Winter is Coming”, but actually, the future of risk is in some ways already here. The RMS strategy is also evolving as risk is evolving, and Karen acknowledged that the solutions of the past cannot solve the challenges and meet the opportunities of the future, if we are to work toward transforming RMS into the world’s leading risk management solutions provider.
So, how is RMS changing? Karen made her debut on the Exceedance keynote stage last year, and already set some deliverables, so it was time for a review. RMS has delivered more than thirty updated and new models, including flood and U.S. wildfire, and behind the scenes, investment in science, research and development from cyber to climate change and more, continues apace.
But, in addition to the continuing commitment to science and research, Karen outlined five new major innovations. The first is the release of an open data standard for risk, the Risk Data Open Standard (RDOS). Addressing the limitations of the RMS proprietary RDM and EDM, the new RDOS provides an opportunity to deliver a new modern data structure to support high quality models for new classes of risk and to solve our clients’ long-standing challenges around financial modeling and interoperability.
The RDOS is owned by the industry, can be used by anyone to develop new products for any line of business. Karen welcomed Cihan Biyikoglu, executive vice president – product, who then introduced another major milestone, RMS Risk Intelligence™ (RI), an open, modular and future-proof platform. It offers all the core elements required to leverage customer data, industry data and third-party data to deliver detailed and precise insights combined with unified model execution. It gives clients the scale, flexibility, extensibility, business value and performance needed to take on the future of risk.
With RI built on a Risk Data Lake, a repository that can securely unify rich RMS data with a client’s own data and third-party data, RI can provide model execution, powerful analytics and intuitive applications that can deliver risk insights directly to the enterprise users such as risk analysts, primary or treaty underwriters or portfolio and exposure managers.
Launching in June, Location Intelligence API will use the RI platform to flow location risk data at scale directly into underwriting systems. And Moe Khosravy, executive vice president for software, wowed delegates with the power of apps using the RI platform, as SiteIQ™ capitalizes on all RMS risk data and any incorporated third-party data for instant analysis of property risk.
Mohsen Rahnama, chief risk modeling officer for RMS also reminded us of the changing nature of risk, and how insured losses are increasing -with the last few years being particularly brutal. In thirty years of RMS, since 1989 the industry has borne US$800 billion of insured losses. Thirty percent of these losses came in 2017 and 2018. New strategies, to cope with extremes exacerbated by climate change such as flood and wildfire, are needed as we enter the era of “Constant Catastrophe”.
After a ground-breaking keynote, delegates went onwards with our track sessions, from using cat risk models to understand climate change, rising to the cyber challenge, and analytics for U.S. wildfire. Check out AM Best interviews with Evan Sekeris from Oliver Wyman on cyber, Michael Andler from Lockton on parametric coverages, and Neil Isford from RMS, on “The Future of Risk Analysis”.
A well-deserved party is now in order, as we celebrate thirty years of RMS at Exceedance this evening, with compulsory cupcakes for all, and look forward to another day of dynamic developments tomorrow.
Kym focuses on the conception, management and execution of Exceedance. She has been with RMS for over 4 years and continues to grow and increase the impact of RMS events (Live and Virtual) for RMS clients and prospects.
As an important part of the marketing team, Kym and her amazing team continue to use their successful event management background to drive engagement, awareness and client experiences.
A California native, Kym is based in the RMS Silicon Valley Office.