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NEWARK, C.A. – November 19, 2018  RMS®, a global risk modeling and analytics firm, has estimated that the insured loss for the Camp and Woolsey wildfires in California will be between USD $9 and $13 billion ($7.5-$10 billion for Camp; $1.5-$3 billion for Woolsey). The estimate includes property and auto damage, including burn and smoke damage, business interruption (BI), additional living expenses (ALE), and contents loss.

The loss estimate utilized RMS’ forthcoming North America Wildfire High Definition (HD) Model to simulate the ignition, fire spread, ember accumulations, and smoke dispersion of the fires. The model’s findings were supported by damage reports from CAL FIRE as of November 18th, observations from displaced residents, and information from firefighting personnel.

The Camp and Woolsey events were among 15 fires that broke out in early November, 2018. The Camp and Woolsey Fires have currently burned a combined total of 245,000 acres, destroyed more than 12,000 homes and businesses, and killed 80 people. The Camp Fire, named for the road of its point of origin, is the most destructive fire in California history, with more than 11,000 structures burned and currently 77 fatalities. Notably, this fire season represents the second consecutive year with more than $10 billion in insured wildfire loss.

While the fuel landscape between the two fires differs significantly, with heavy forestry characterizing the Camp Fire (Northern California) and shrubland in the Woolsey Fire (Southern California), both developed under dangerous conditions that favor quick fire spread: low moisture, abnormally high temperatures, dry vegetation, and intense seasonal winds. Both traveled quickly through steep, hilly, vegetated terrain.

The town of Paradise, CA, which suffered the worst losses of the Camp Fire, has narrowly avoided catastrophic wildfires many times over the past 20 years. Thirteen large fires since 1999 have burned inside the current footprint of the Camp Fire.

The Woolsey Fire, igniting in Ventura County and jumping the Highway 101 before spreading to Malibu, resulted in over 250,000 evacuations and burned more than 1,450 high value properties.

The area around the Woolsey Fire shares a similar, if less stark, history of frequent fires. Six large fires since 1999 intersect the Woolsey footprint. Going back to 1993, the Old Topanga Wildfire, which caused almost $1 billion in today’s dollars, occurred immediately next where the Woolsey fire is currently burning.

Mohsen Rahnama, Chief Risk Modeling Officer, RMS, said: “Wildfire is now a major catastrophe risk that must be rigorously managed with the best data and model science. With increasing exposure due to properties near wildland areas and ongoing climate variability, insurers, policymakers, and homeowners must adapt to the prospect of more frequent and severe wildfires.”

“In the wake of consecutive record-breaking wildfire seasons, we are hopeful that more focus will be placed on fire mitigation, safe construction practices, and community resilience. The forthcoming RMS HD Wildfire model, developed in partnership with leading insurers and fire experts, represents a step change in measuring wildfire risk, with a 50,000-year climate simulation, explicit ember and smoke simulations, and a vulnerability module calibrated on hundreds of millions of dollars of claims data. We are confident the model will contribute to the creation of safer communities that promote fire safety and awareness.”

ENDS

The technology and data used in providing this Information is based on the scientific data, mathematical and empirical models, and encoded experience of scientists and specialists. As with any model of physical systems, particularly those with low frequencies of occurrence and potentially high severity outcomes, the actual losses from catastrophic events may differ from the results of simulation analyses. RMS SPECIFICALLY DISCLAIMS ANY AND ALL RESPONSIBILITIES, OBLIGATIONS AND LIABILITY WITH RESPECT TO ANY DECISIONS OR ADVICE MADE OR GIVEN AS A RESULT OF THE INFORMATION OR USE THEREOF, INCLUDING ALL WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO, WARRANTIES OF NON-INFRINGEMENT, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL RMS (OR ITS PARENT, SUBSIDIARY, OR OTHER AFFILIATED COMPANIES) BE LIABLE FOR DIRECT, INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES WITH RESPECT TO ANY DECISIONS OR ADVICE MADE OR GIVEN AS A RESULT OF THE CONTENTS OF THIS INFORMATION OR USE THEREOF.

Related Resources
November 16, 2022
RMS Estimates Less than US$2 Billion in Total Private Market U.S. Insured Losses from Hurricane Nicole

Newark, CA – November 16, 2022 - RMS®, a Moody’s Analytics company and a world-leading risk modeling and solutions company, estimates total private market U.S. insured losses from Hurricane Nicole to be less than US$2 billion, with the best estimate of US$1.6 billion. This estimate represents insured losses associated with wind, storm surge, and precipitation-induced flooding. Total insured loss estimates for Hurricane Nicole (US$ billions):   Wind (incl. coverage leakage) + Surge Inland Flood excl. NFIP Total excl. NFIP Best Estimate Private Market Insured Loss 1.2 – 1.8 < 0.1 1.3 – 1.9 1.6 RMS estimates privately insured wind and storm surge losses of US$1.2 billion to US$1.8 billion from Hurricane Nicole, based on analysis of ensemble footprints in Version 21 of the RMS North Atlantic Hurricane Models. RMS ensemble footprints are reconstructions of Nicole’s hazard that capture the uncertainties surrounding observed winds and storm surge. RMS modelers developed and validated the wind, storm surge, and inland flood reconstructions and corresponding loss estimates using publicly available observations, including wind stations, river gauge water level data, and web reconnaissance. Jeff Waters, Staff Product Manager, North Atlantic Hurricane Models, RMS, said: “Even though Hurricane Nicole was much less intense than Hurricane Ian a few weeks prior, it exhibited a large wind field that impacted many of the same areas in Florida. RMS Event Response teams estimate that roughly 98 percent of postal codes in Florida impacted by Nicole were previously impacted by Hurricane Ian. Similar to other overlapping events from previous seasons, such as Hurricanes Ida and Nicholas in 2021, and Laura and Delta in 2020, we expect the overlapping nature of Hurricane Ian and Nicole to introduce significant uncertainties in the loss attribution and claims settlement process.” Additionally, RMS estimates losses for the National Flood Insurance Program (NFIP) from Nicole to be less than US$300 million, and primarily in Florida and Georgia. These losses were derived using the RMS view of NFIP exposure based on policy-in-force data published by FEMA, the Version 21 RMS North Atlantic Hurricane Models, and the RMS U.S. Inland Flood HD Model. Losses reflect property damage and business interruption to residential, commercial, industrial, and automobile lines of business, and consider sources of post-event loss amplification (PLA), inflationary trends, and non-modeled sources of loss. RMS expects the majority of wind and storm surge losses to come from Florida, and the majority of the NFIP and insured flood losses to come from both Florida and Georgia. “Historically, an event of Hurricane Nicole’s magnitude would not exhibit notable PLA impacts if it were to occur on its own. However, the fact that it closely follows a major event with Hurricane Ian, means that the same factors influencing PLA from Ian also apply to Nicole, including shortages of labor, materials, and claims adjusters. This is an example of compounding PLA effects,” said Sarah Hartley, Manager, Event Response, RMS. Hurricane Nicole was the fourteenth-named storm of the 2022 North Atlantic hurricane season, the eighth hurricane, and the second hurricane to make U.S. landfall this season. Nicole made landfall on November 10, 2022, near Vero Beach, Florida as a Category 1 hurricane on the Saffir-Simpson Hurricane Wind Scale with maximum sustained winds of 75 miles per hour (120 km/h). The storm brought a combination of strong winds, storm surge, and heavy rainfall to coastal and inland areas of Florida, including many that are still recovering from Hurricane Ian. Hurricane Nicole briefly re-emerged into the Gulf of Mexico as a tropical storm before weakening to a tropical depression and moving back onshore, tracking northward through the southeast U.S., the Carolinas, and mid-Atlantic regions. Prior to impacting the U.S., Hurricane Nicole hit parts of the Bahamas as both a tropical storm and Category 1 hurricane. However, RMS expected insured losses to be minimal in that region. There are two weeks left in the 2022 Atlantic Hurricane season, which officially ends on November 30. RMS industry loss estimates for landfalling hurricanes provide a comprehensive view, reflecting modeled and non-modeled impacts from all major drivers of damage, including wind, storm surge, and inland flooding.   END The technology and data used in providing this information is based on the scientific data, mathematical and empirical models, and encoded experience of scientists and specialists. As with any model of physical systems, particularly those with low frequencies of occurrence and potentially high severity outcomes, the actual losses from catastrophic events may differ from the results of simulation analyses. RMS SPECIFICALLY DISCLAIMS ANY AND ALL RESPONSIBILITIES, OBLIGATIONS, AND LIABILITY WITH RESPECT TO ANY DECISIONS OR ADVICE MADE OR GIVEN AS A RESULT OF THIS INFORMATION OR USE THEREOF, INCLUDING ALL WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO, WARRANTIES OF NON-INFRINGEMENT, MERCHANTABILITY, AND FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL RMS (OR ITS PARENT, SUBSIDIARY, OR OTHER AFFILIATED COMPANIES) BE LIABLE FOR DIRECT, INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES WITH RESPECT TO ANY DECISIONS OR ADVICE MADE OR GIVEN AS A RESULT OF THE CONTENTS OF THIS INFORMATION OR USE THEREOF.

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October 07, 2022
RMS Estimates US$67 Billion in Insured Losses from Hurricane Ian

Newark, CA – October 7, 2022 – RMS®, a Moody’s Analytics company and world-leading risk modeling and solutions company, estimates total private market insured losses from Hurricane Ian to be between US$53 billion and US$74 billion, with the best estimate of US$67 billion. RMS also estimates the National Flood Insurance Program (NFIP) could see an additional US$10 billion in losses from storm surge and inland flooding as a result of the event.   Wind incl. coverage leakage Storm Surge excl. NFIP Inland Flood excl. NFIP Total* Best Estimate Private Market Insured Loss $46 – $67 bn $6+ bn $1+ bn $53 – $74 bn $67 bn *Losses rounded to nearest billion  The overall industry loss estimate for Ian includes wind and storm surge losses in Florida, South Carolina, North Carolina, Georgia, and Virginia, based on an analysis of ensemble footprints in Version 21 of the RMS North Atlantic Hurricane Models. RMS ensemble footprints are reconstructions of Ian’s hazard that capture the uncertainties surrounding observed winds and storm surge. The industry estimate also includes impacts from precipitation-induced inland flooding in the same regions, using footprints in the RMS U.S. Inland Flood HD Model. “Ian was a historic and complex event that will reshape the Florida insurance market for years to come. Given the complexity of the event and the multiple drivers of the loss, our ability to deploy multiple RMS field reconnaissance teams to conduct damage assessments throughout Florida, including the heavily affected areas of Fort Myers and Cape Coral along the southwest coast, has been a critical component of our analysis. Their assessments have proved invaluable in helping our modeling teams to reconstruct and validate the extent and severity of Ian’s wind and water impacts, and our assessment of the magnitude of the various drivers of the total industry loss,” said Mohsen Rahnama, Chief Risk Modeling Officer, RMS. The RMS estimate reflects losses from property damage, contents, and business interruption, across residential, commercial, industrial, automobile, infrastructure, watercraft, and other specialty lines. Given the complexity of this event and the multiple loss drivers, our ability to couple our detailed review of satellite and digital imagery together with the deployment of multiple RMS field reconnaissance teams have proved to be pivotal in establishing losses across the various business lines. The estimate also considers the impacts of post-event loss amplification (PLA), inflation, and non-modeled sources such as the Assignment of Benefits and litigation. Much of the building stock affected by Ian was also impacted to varying degrees by Hurricane Irma in 2017 and Hurricane Charley in 2004. In some cases, roofs or structures were replaced after Irma and performed well in Ian. However, where buildings were not upgraded to recent codes, Ian’s destructive wind and storm surge will cause widespread roof replacements or total losses. In the loss estimation process, we also considered key aspects of the Florida Building Code, including mandatory limit extensions for ordinance and law, and the application of the 25 percent roof replacement rule. Aside from property damage, we expect significant losses to automobile and watercraft lines in this event due to fewer evacuations in the worst-affected region,” said Jeff Waters, Staff Product Manager, Product Management, RMS. “A sizable portion of the losses from Ian will be associated with post-event loss amplification and inflationary trends. A combination of high claims volume, additional living expenses related to the massive evacuation efforts, prolonged reconstruction in the worst-affected areas, and the prevalent higher-than-average construction costs will contribute to a significant economic demand surge. Additionally, we expect the Assignment of Benefits and litigation – despite recent legislative efforts to curb their misuse, to influence the overall loss severity, especially in cases where coverage leakage of water losses onto wind-only policies is likely. All these social inflation factors will lead to complex and lengthy claims settlement processes in this event, amplifying loss adjustment expenses and corresponding claim costs,” said Rajkiran Vojjala, Vice President, Model Development, RMS. Losses to the National Flood Insurance Program of approximately US$10 billion are based on using the RMS view of NFIP policy-in-force data published by FEMA, the Version 21 RMS North Atlantic Hurricane Models, and the RMS U.S. Inland Flood HD Model. While NFIP policy take-up is substantial in many coastal areas affected by Ian (up to 50 percent), areas hard-hit by inland flooding in the event typically have minimal (less than 10 percent) NFIP participation. RMS expects the majority of total insured losses from Ian to be driven by wind. However, a sizable portion (up to 25 percent) of the total insured losses (incl. NFIP) will be driven by surge and flood. While insured wind losses and losses to the NFIP will be driven by residential lines, surge and inland flood losses to the private market will be dominated by commercial, industrial, and automobile lines. In addition to the U.S., Hurricane Ian also impacted parts of the Caribbean, notably Cuba, with strong winds, heavy rain, and flooding. While Cuba saw severe economic and infrastructure damage in the event across many areas, RMS estimates insured losses in Cuba will be minimal due to low insurance penetration in the region. After Ian passed Cuba, it made landfall near Cayo Costa, Florida on Wednesday, September 28, as a strong Category 4 hurricane on the Saffir-Simpson Hurricane Wind Scale. At landfall, Ian produced sustained winds of 150 miles per hour (240 km/h), according to the National Hurricane Center. After traversing slowly over central Florida, it emerged over the Atlantic before making a second landfall near Georgetown, South Carolina on Friday, September 30, as a Category 1 hurricane. Ian brought destructive hurricane-force winds to a broad swath of southwest and central Florida, catastrophic storm surge along the southwest Florida coastline, and widespread inland flooding throughout Florida and the Carolinas. Hurricane Ian was the ninth named storm of the 2022 North Atlantic hurricane season, the fourth hurricane, and the first named storm to make landfall in the U.S. this season. Ian was the first major category hurricane to make landfall in Florida since Hurricane Michael in 2018, and the seventh U.S. major hurricane landfall since 2017 (Harvey, Irma, Michael, Laura, Zeta, Ida). Less than two months remain in the 2022 North Atlantic hurricane season, officially ending on November 30.   END The technology and data used in providing this information is based on the scientific data, mathematical and empirical models, and encoded experience of scientists and specialists. As with any model of physical systems, particularly those with low frequencies of occurrence and potentially high severity outcomes, the actual losses from catastrophic events may differ from the results of simulation analyses. RMS SPECIFICALLY DISCLAIMS ANY AND ALL RESPONSIBILITIES, OBLIGATIONS AND LIABILITY WITH RESPECT TO ANY DECISIONS OR ADVICE MADE OR GIVEN AS A RESULT OF THIS INFORMATION OR USE THEREOF, INCLUDING ALL WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO, WARRANTIES OF NON-INFRINGEMENT, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL RMS (OR ITS PARENT, SUBSIDIARY, OR OTHER AFFILIATED COMPANIES) BE LIABLE FOR DIRECT, INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES WITH RESPECT TO ANY DECISIONS OR ADVICE MADE OR GIVEN AS A RESULT OF THE CONTENTS OF THIS INFORMATION OR USE THEREOF.

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August 26, 2022
AXA Climate to Use RMS HWind as a Trigger Metric for Parametric Insurance Policies

LONDON – 26 August, 2022 – AXA Climate, an entity of the AXA Group specializing in climate change adaptation, will include HWind analytics from RMS®, a Moody’s Analytics company and world-leading risk modeling and solutions company, as a trigger metric for its relevant parametric insurance policies. HWind produces real-time data sets for tropical cyclone events, allowing quick evaluation of hurricane trigger/payout conditions, which enables parametric policyholders to gain rapid access to capital following impactful events. RMS HWind solutions offer comprehensive coverage over the Western North Atlantic, Eastern Pacific, and Central Pacific basins. Using RMS HWind helps AXA Climate to be fully flexible as to how and where they structure parametric policies, allowing AXA Climate to reassure their clients that they will quickly receive the protection they paid for when damaging winds are present. Amaury Dufetel, Head of Insurance, AXA Climate, said: “As an Engaged Climate Insurer, we believe the preciseness of sophisticated real-time data is essential to improve the use and uptake of parametric insurance solutions. Data coming from independent reputable organizations like RMS HWind solutions, developed over more than 25 years by one of the world’s leading hurricane observation researchers, will allow us to structure innovative parametric covers and bring to our clients the best tailormade Tropical Cyclone coverage both in terms of price and claim settlement.” Charlotte Acton, Senior Director, RMS, added: “By working closely with AXA Climate, we have been able to help an important client develop innovative products that offer a competitive advantage and can help enable growth into new markets. Parametric insurance is another example of how the insurance industry can help build resilience into economies, which in turn helps reduce the protection gap. RMS remains committed to supporting insurance innovation, in our products, for our clients, and for their end users.”       About AXA Climate AXA Climate is a Committed Climate Insurer: We integrate best-in-class climate expertise and data in all our products. We believe that from this decade onwards, only private and public actors committed to a sustainable transition will be insurable.   Our mission is to reinvent the insurance business to support those engaged in sustainable transitions. We have developed a set of business lines around climate change: parametric insurance against climate risks, climate and nature consulting services, financing and climate training to engage all employees.   We are a team of over 150 collaborators spread across the 5 continents, leveraging the entire AXA ecosystem. Visit https://www.climate.axa/ to learn more and follow us on LinkedIn.

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About RMS

Risk Management Solutions, Inc. (RMS) a Moody's Analytics company, shapes the world's view of risk for insurers, reinsurers, financial services organizations, and the public sector. We empower organizations to evaluate and manage global risk from natural and man-made catastrophes, including hurricanes, earthquakes, floods, climate change, cyber, and pandemics. RMS models underlie the nearly US$2 trillion Property & Casualty industry and many insurers, reinsurers, and brokers around the world rely on RMS model science.

RMS helped pioneer the catastrophe risk industry, and continues to lead in innovation by offering unmatched science, technology, and 300+ catastrophe risk models. Leaders across multiple industries can address the risks of tomorrow with the RMS Intelligent Risk Platform™, the only open cloud with collaborative applications and unified analytics that can power risk management excellence across organizations and industries. 

Further supporting the industry's transition to modern risk management, RMS spearheaded the Risk Data Open Standard (RDOS), a modern, open-standard data schema designed to be an extensible and flexible asset within modeling/analysis systems.

RMS is a trusted solutions partner, enabling effective risk management for better business decision-making across risk identification and selection, mitigation, underwriting, and portfolio management.

Visit RMS.com to learn more and follow us on LinkedIn and Twitter.

RMS is a subsidiary of Moody’s Corporation (NYSE: MCO) and operates as part of the Moody’s Analytics business segment. Moody’s Analytics is operationally and legally separate from the Moody’s Investors Service credit rating agency.

Media Contacts

Matthew Longbottom

PR Lead, EU and APAC
+44 20 7444 7706 prteam@rms.com

Haggie Partners

PR Lead, Americas
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