Author Archives: EXPOSURE magazine

EXPOSURE magazine

About EXPOSURE magazine

EXPOSURE magazine from RMS is an essential briefing for catastrophe and risk management professionals who want to explore the latest opinions from the industry, new opportunities, and best practice to help their organization thrive in an increasingly competitive and disruptive market.

RMS Location Intelligence API: Underwriting with 20/20 Vision

This is a taster of an article published in the latest edition of EXPOSURE magazine featuring the RMS Location Intelligence API. For the full article click here or visit the EXPOSURE website.

The insurance industry boasts some of the most sophisticated modeling capabilities in the world. And yet the average property underwriter does not have access to the kind of predictive tools that carriers use at a portfolio level to manage risk aggregation, streamline reinsurance buying and optimize capitalization.

Detailed probabilistic models are employed on large and complex corporate and industrial portfolios. But underwriters of high-volume business are usually left to rate risks with only a partial view of the risk characteristics at individual locations, and without the help of models and other tools.

Many insurers invest in modeling post-bind in order to understand risk aggregation in their portfolios, but Ross Franklin, senior director of data product management at RMS, suggests this is too late. “From an underwriting standpoint, that’s after the horse has bolted — that insight is needed upfront when you are deciding whether to write and at what price.”

By not seeing the full picture, he explains, underwriters are often making decisions with a completely different view of risk from the portfolio managers in their own company. “Right now, there is a disconnect in the analytics used when risks are being underwritten and those used downstream as these same risks move through to the portfolio.”

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SiteIQ and the Art of Empowerment

This is a taster of an article published in the latest edition of EXPOSURE magazine featuring the new RMS application – SiteIQTM. For the full article click here or visit the EXPOSURE website.

EXPOSURE magazine recently looked at the challenges that underwriters and agents at coverholders currently face, to get comprehensive risk data when evaluating an individual location.

When evaluating single risks, underwriters and coverholders typically have to request exposure analytics from their portfolio managers and brokers, or gather their own supplementary risk data from a range of external resources, whether it is from Catastrophe Risk Evaluation and Standardizing Target Accumulations (CRESTA) zones, through to lookups on Google Maps. But all this takes valuable time, requires multiple user licenses and can generate information that is inconsistent with the underlying modeling data at the portfolio level.

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EXPOSURE Magazine: Exploring the World of Risk Management

With the start of the U.S. wildfire season on the horizon, in the latest edition of EXPOSURE – the RMS magazine for risk management professionals, wildfire is our lead story, as we examine whether it now needs to be considered a peak peril. The 2017 and 2018 California wildfires have forced one of the biggest re-evaluations of a natural peril since Hurricane Andrew in 1992, as the industry begins to comprehend the potential loss severities.

The article argues that there are similarities with U.S. wildfire as there was with North Atlantic hurricane in 1992 – catastrophe models were relatively new and had not gained market-wide adoption, and many organizations were not systematically monitoring and limiting large accumulation exposure in high-risk areas. Find out why a rethink is required about how the risk management industry currently analyzes the exposure and the tools it uses.

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EXPOSURE Magazine: Taking Cloud Adoption to the Core

This is a taster of an article published in the latest edition of EXPOSURE magazine. For the full article click here or visit the EXPOSURE website.

With the main benefits of Cloud computing now well-established, EXPOSURE explored why insurance and reinsurance companies have demonstrated some reluctance in moving core services onto a Cloud-based infrastructure.

While a growing number of insurance and reinsurance companies are using Cloud services (such as those offered by Amazon Web Services, Microsoft Azure and Google Cloud) for nonessential office and support functions, most have been reluctant to consider Cloud for their mission-critical infrastructure. Simply moving a legacy offering and placing it on a new Cloud platform offers a potentially better user interface, but it’s not really transforming the process.

EXPOSURE also asked whether now is the time for market-leading (re)insurers to make that leap and really transform how they do business, embrace the new and different, and take comfort in what other industries have been able to do.

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EXPOSURE Magazine: Essential Reading in Changing Times

The pace of change continues to accelerate across the insurance industry, whether it is from technology, regulation or market developments, and EXPOSURE magazine helps risk professionals to explore some of the key drivers of these changes.

In this latest edition available for distribution at the Monte Carlo Rendezvous and online, the lead story looks at the recent market activity from Tower Insurance in New Zealand. By adopting high-definition earthquake modeling, Tower gained the confidence to launch risk-based pricing for its customers, providing savings for the majority of policyholders, but increases for others. EXPOSURE looks at the implications of Tower’s actions and how this could affect the New Zealand insurance market.

High resolution modeling has also helped Flood Re in the U.K. to better understand how it can work towards its remit of delivering a flood insurance market based on risk-reflective pricing that is affordable to policyholders. EXPOSURE shows how innovative use of modeling could guide Flood Re when recommending investment measures to protect properties at risk of flooding.

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EXPOSURE: Assigning a Return Period to 2017

This is a taster of an article published in the latest edition of EXPOSURE magazine. For the full article click here or visit the EXPOSURE website.

Hurricanes Harvey, Irma and Maria (HIM) tore through the Caribbean and U.S. in 2017, resulting in insured losses over US$80 billion. Twelve years after Hurricanes Katrina, Rita and Wilma (KRW), EXPOSURE asks if the (re)insurance industry was better prepared for its next “terrible trio” and what lessons can be learned.

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EXPOSURE: Data Flow in a Digital Ecosystem

This is a taster of an article published in the latest edition of EXPOSURE magazine. For the full article click here or visit the EXPOSURE website.

There has been much industry focus on the value of digitization at the customer interface, but EXPOSURE magazine asks industry thought-leaders, what is its role in risk management and portfolio optimization? How can we help teams on the underwriting frontline?

For Louise Day, director of operations at the International Underwriting Association (IUA), a major issue is that much of the data generated across the industry is held remotely from the underwriter.

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EXPOSURE Magazine: Looking Back, Looking Forward

The latest edition of EXPOSURE is essential reading for risk professionals, as we look back at what can be learned from last year’s events and look forward to the future including new challenges faced by the global risk management community and new opportunities to capitalize on.

EXPOSURE offers a unique perspective with a clear mission “… to provide insight and analysis to help insurance and risk professionals innovate, adapt and deliver.” And with a new North Atlantic hurricane season nearly upon us, and memories of HIM (Hurricane Harvey, Irma and Maria) fresh in the industry’s collective consciousness, EXPOSURE talks to the industry and paints a picture of a mature, responsible insurance sector that managed HIM with certainty and confidence. Cyber has also demonstrated its potential as a global systemic risk, and EXPOSURE looks at how events such as an outage of a major cloud services provider could generate economic losses as high as Superstorm Sandy.

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EXPOSURE Magazine Snapshots: Water Security – Managing the Next Financial Shock

This is a taster of an article published by RMS in the second edition of EXPOSURE magazine.  Click here and download your full copy now.

18 Apr 2017 Exposure Drought image

 

EXPOSURE magazine reported on how a pilot project to stress test banks’ exposure to drought could hold the key to future economic resilience, as recognition grows that environmental stress testing is a crucial instrument to ensure a sustainable financial system.

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EXPOSURE Magazine Snapshots: A New Way of Learning

This is a taster of an article published by RMS in the second edition of EXPOSURE magazine.  Click here and download your full copy now.

7 Apr 2017 - Machine Learning blog - Exposure banner image 720 x 168

 

In EXPOSURE magazine, we delved into the algorithmic depths of machine learning to better understand the data potential that it offers the insurance industry.  In the article, Peter Hahn, head of predictive analytics at Zurich North America illustrated how pattern recognition sits at the core of current machine learning. How do machines learn?  Peter compares it to how a child is taught to differentiate between similar animals; a machine would “learn” by viewing numerous different pictures of the animals, which are clearly tagged, again and again.

Hahn comments “Over time, the machine intuitively forms a pattern recognition that allows them to tell a tiger from, say, a leopard. You can’t predefine a set of rules to categorize every animal, but through pattern recognition you learn what the differences are.”

Hahn adds that pattern recognition is already a part of how underwriters assess a risk. “A decision-making process will obviously involve traditional, codified analytical processes, but it will also include sophisticated pattern recognition based on their experiences of similar companies operating in similar fields with similar constraints. They essentially know what this type of risk ‘looks like’ intuitively.”

The Potential of Machine Learning

EXPOSURE magazine asked Christos Mitas, vice president of model development at RMS, on how he sees machine learning being used.  Mitas opened the discussion saying “We are now operating in a world where that data is expanding exponentially, and machine learning is one tool that will help us to harness that.”

Here are three areas where Mitas believes machine learning will make an impact:

Cyber Risk Modeling: Mitas adds “Where machine learning can play an important role here is in helping us tackle the complexity of this risk. Being able to collect and digest more effectively the immense volumes of data which have been harvested from numerous online sources and datasets will yield a significant advantage.”

Image Processing: “With developments in machine learning, for example, we might be able to introduce new data sources into our processing capabilities and make it a faster and more automated data management process to access images in the aftermath of a disaster. Further, we might be able to apply machine learning algorithms to analyze building damage post event to support speedier loss assessment processes.”

Natural Language Processing: “Advances here could also help tremendously in claims processing and exposure management,” Mitas adds, “where you have to consume reams of reports, images and facts rather than structured data. That is where algorithms can really deliver a different scale of potential solutions.”

For the full article and more insight for the insurance industry, click here and download your full copy of EXPOSURE magazine now.

For more information on RMS(one)®, a big data and analytics platform built from the ground-up for the insurance industry, and solutions such as Risk Modeler and Exposure Manager, please click here.