Loss Costs

Loss cost (“pure premium”) is one of the most important metrics in underwriting. It reflects the true cost of insuring a risk and is closely tied to final price paid by the insured. Many insurer insolvencies can be tied to its miscalculation.

The RMS Location Intelligence API: Loss Cost Metrics That Enhance Underwriting Capabilities

Capital management and reinsurance purchasing decisions are based on catastrophe metrics at various return periods (typically 100, 250, or 500 years). But insurance contracts must be priced on the expectations of loss in a single year. The RMS Location Intelligence API can provide this insight quickly, accurately, and with minimal technical overhead.

RMS loss costs are distilled from terabytes of catastrophe simulation data, enabling real-time, ultra-high resolution insight. API-based implementation is frictionless, simple, and fast. Simply send an address (or coordinates) with optional details on building attributes and the APIs returns a loss cost. Full documentation is available to support the scientific assumptions underlying each metric.

Mispricing Kills

Pricing is a mission-critical part of insurer operations and getting it wrong can be disastrous. Cat pricing is even more difficult due to the dearth of historical claims. It’s simply too important to use anything but the best cat analytics at the point of underwriting. RMS delivers that insight.

Vulnerability Matters

Today, too many risk selection and pricing metrics are based on hazard-only scores. The problem is, vulnerability matters: brick houses perform well in fires but poorly in earthquakes. RMS loss costs, calibrated on billions of dollars of claims, are vulnerability-specific to meet this need.

Full Transparency

Don’t rely on black box data for your pricing needs. RMS loss costs are provided for structure, contents, and business interruption – with full documentation on the upstream simulations that created them.

Deductible Support

Need to provide multiple deductible options? Hit our fast API and get the deductible-adjusted results in milliseconds.

Fast Access for Automated Underwriting

The RMS location intelligence API pre-compiles big data simulations so you can have them at your fingertips. For the first time, the world’s best model science is available in real time.

Perils Available:

  • Earthquake
  • Flood
  • Hail
  • Storm Surge
  • Terrorism
  • Tornado
  • Wildfire
  • Wind
  • Winter Storm