NEWARK, CA – May 4th, 2020: RMS, the leading global risk modeling and analytics firm, announced today at its annual Exceedance conference the release of new European Severe Convective Storm (EU SCS) High Definition Models. The models represent 50,000 years of simulation of hail and straight-line wind and tornado risk and include all key lines of business -- including automobile and property. In addition, the models cover 17* countries in Europe, complementing the RMS European climate hazard model suite.
Severe convective storms in Europe generally occur within the mid-latitudes in summer and can cause extensive loss to vehicles and property. Sometimes viewed as an attritional peril, severe convective storm risk is often managed using historical experience, despite incomplete observational reporting. Recent events have shown the potential cost this peril can cause for the (re)insurance industry. From 2013 to 2019, losses from major and attritional severe convective storms exceeded €12 billion.
The models cover the full spectrum of sources of SCS loss, from localized tornadoes and hailstorms to large derechos. The HD framework enables modeling time-based policy conditions such as hours clauses of varying length, fulfilling the diverse needs of European insurers for underwriting, portfolio management, and capital adequacy. The models were developed based on the latest scientific research and complement the existing suite of RMS climate peril models for Europe, providing users with a holistic view of climate risk across the domain.
Severe convective storms have the particularity to drive significant impact to both property and automobile lines of business. RMS employs innovative technology to model the vulnerability of these two lines. This includes dynamic modeling of automobile movement, helping users understand sensitivity in vehicle vulnerability due to variation in location and time of day.
The RMS Severe Convective Storm HD Models benefit from the HD simulation technology available within the RMS unified cloud platform, RMS Risk Intelligence™ (RI). With the new version of Risk Modeler 2.0™, which runs on RI, HD Models will now be integrated to work in the familiar workflows RiskLink® provides for RMS’s existing users, and the new HD Models are seamlessly integrated with RiskLink models for side by side use. The RMS Severe Convective Storm HD models are available today through Analytical Services, for evaluation and validation, and will be running on Risk Modeler 2.0 for summer 2020.
Mohsen Rahnama, Chief Risk Modeling Officer, RMS said:“RMS’ EUSCS HD Models give a pan-European view of convective storm risk, developed using latest scientific research, and complementing the existing RMS Europe Wind & Flood solutions, providing users with a holistic view of climate risk across the domain. It covers the full spectrum of SCS hazards - from localized tornadoes, diverse hailstorms, to large derechos. We use a hybrid modeling approach combining parametric and statistical methods which best capture storm footprints, and their associated frequency and severity, hence enabling the assessment of cross-peril correlations. The multi-peril stochastic set includes over 7.5 million events, covering 17 countries, based on 50,000 years of simulations, so that we appropriately capture the spatial and temporal scale of convective storm risk in the European modelling domain. This provides in-depth analytics not only on potential loss magnitudes for insurers’ portfolios, but it also captures the geographic and sub-peril correlations accurately. The model is calibrated using billions of Euro property and automobiles claims data.”
RMS High Definition Models are the next generation of risk modeling, delivering greater analysis and granularity than ever before. RMS HD Models have now all undergone a significant upgrade as they transitioned to the Risk Modeler application, which gives them greater flexibility and computational strength. The following models are in addition to the US Flood and US Wildfire HD Models that have been available through Risk Modeler’s earlier version:
Each of these models is available today through Analytical Services and for evaluation and validation, and will be coming onto Risk Modeler 2.0 for June-September 2020.
ENDS
* - The 17 countries are: Austria, Belgium, Czech Republic, Denmark, France, Germany, Italy, Liechtenstein, Luxembourg, the Netherlands, Norway, Poland, Ireland, Slovakia, Sweden, Switzerland, and the United Kingdom. France includes Monaco; Italy includes San Marino and Vatican City.
Newark, CA – September 23, 2021 – RMS®, the world’s leading catastrophe risk solutions company, estimates that the total U.S. insured losses from Hurricane Nicholas to be between US$1.1 and US$2.2 billion. This estimate represents insured losses associated with wind, storm surge, and precipitation-induced flooding, including losses to the National Flood Insurance Program (NFIP). Nicholas made landfall on September 14, 2021 near Sargent Beach, Texas as a Category 1 hurricane on the Saffir-Simpson Hurricane Wind Scale with maximum sustained winds of 75 miles per hour (120 km/h). The storm brought hurricane-force winds, prolonged heavy rainfall to the central Gulf Coast, including many areas in southern Louisiana still recovering from Hurricane Ida, as well as Hurricanes’ Laura and Delta (2020). Total insured loss estimates for Hurricane Nicholas (US$ billions): Wind + Surge Private Inland Flood NFIP Total 0.7 – 1.4 0.2 – 0.3 0.2 – 0.5 1.1 – 2.2 RMS estimates US$700 million to US$1.4 billion in privately insured wind and storm surge losses based on analysis of ensemble footprints in Version 21 of the RMS North Atlantic Hurricane Models. RMS ensemble footprints are reconstructions of Nicholas’ hazard that capture the uncertainties surrounding observed winds and storm surge. The precipitation-induced inland flooding losses were generated using footprints from the RMS U.S. Inland Flood HD Model. RMS modelers developed and validated the wind, storm surge, and inland flood reconstructions and corresponding loss estimates using publicly available observations, including wind stations, rivers water level gauge data, and web reconnaissance. “A notable impact from this event is the rainfalls, especially in Louisiana, where many towns and cities are still in the early stages of recovery after Hurricane Ida. RMS event response teams estimate roughly 40 percent of postal codes in Louisiana that were impacted by flooding in Nicholas were also impacted by flooding from Ida a few weeks earlier. We expect the overlapping nature of these two storms to further amplify losses, including the risk of rainfall infiltration, and to prolong the claims settlement process,” says Jeff Waters, Senior Product Manager, RMS North Atlantic Hurricane Models. The estimate also includes US$200 – $500 million in losses for NFIP in Texas and the Gulf of Mexico region. NFIP losses were derived using RMS’ view of NFIP exposure based on 2019 policy-in-force data published by FEMA, Version 21 North Atlantic Hurricane Models, and the U.S. Inland Flood HD Model. Losses reflect property damage and business interruption to residential, commercial, industrial, and automobile lines of business, and considers sources of post-event loss amplification (PLA). RMS expects the majority of wind and storm surge losses to come from Texas, and the majority of the NFIP and insured flood losses to come from Louisiana. Hurricane Nicholas was the fourteenth named storm of the 2021 North Atlantic hurricane season and the sixth hurricane. It was the second hurricane to make landfall this season. RMS industry loss estimates for landfalling hurricanes are comprehensive, 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.
Newark, CA – September 16, 2021 – RMS®, the world’s leading catastrophe risk solutions company, estimates total onshore and offshore U.S. insured losses from Hurricane Ida to be between US$31 and US$44 billion. The estimate builds upon the earlier industry loss estimate of US$25-$35 billion for the Gulf of Mexico region, to include inland flooding impacts in the Ohio Valley, Mid-Atlantic, and Northeast U.S. regions. RMS estimates US$6–$9 billion in insured losses from precipitation-induced flooding in the Atlantic states in this event. The majority of the insured flood losses in the Ohio Valley, Mid-Atlantic, and Northeast U.S. – between US$4.5 and US$7.0 billion, will be to the private market, with an additional US$1.5–$2.0 billion to the National Flood Insurance Program (NFIP). Total U.S. onshore and offshore insured loss estimates for Hurricane Ida (US$ billions): Wind + Surge Inland Flood NFIP Offshore Energy Total Gulf 21 - 28 1.0 - 1.5 2.3 - 4.0 0.7 - 1.5 25 - 35 Ohio Valley, Mid-Atlantic, Northeast U.S. n/a 4.5 - 7.0 1.5 - 2.0 n/a 6 - 9 Total U.S. Onshore and Offshore 21 - 28 5.5 - 8.5 3.8 - 6.0 0.7 - 1.5 31 - 44 The overall industry loss estimate for this event includes wind and storm surge losses in the Gulf of Mexico based on analysis of ensemble footprints in Version 21 of the RMS North Atlantic Hurricane Models. RMS ensemble footprints are reconstructions of Ida’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 Gulf Coast states (Alabama, Florida, Louisiana and Mississippi), Ohio Valley, Mid-Atlantic, and Northeast regions, using footprints from the RMS U.S. Inland Flood HD Model. “Ida will be remembered as a wind and storm surge event in the Gulf of Mexico, and a flood event in the Mid-Atlantic and Northeast U.S. The storm’s remnants brought historic amounts of rainfall over just a few hours to some of the most exposure-dense areas in that part of the country. Many locations from Philadelphia to New York City experienced six-hourly rainfall totals in excess of 100-year return period levels, which is beyond building design standards in that region, causing widespread fluvial and pluvial flooding. The fact that this region also experienced heavy rainfall from Tropical Storm Henri a few weeks prior created saturated antecedent conditions that exacerbated the extent and severity of flooding in Ida,” said Jeff Waters, Senior Product Manager, RMS North Atlantic Hurricane Models. Losses for the Ohio Valley, Mid-Atlantic, and Northeast regions reflect property damage and business interruption to residential, commercial, industrial, and automobile lines of business, as well as sources of post-event loss amplification and leakage of flood losses onto windstorm policies. “RMS expects insured losses associated with precipitation-induced inland flooding to be material in the Mid-Atlantic and Northeast, even though a sizable flood protection gap remains. RMS estimates total economic losses from flooding in this region to be over US$15 billion, meaning that the majority of flood damages for this event will be uninsured. Many properties in New York and New Jersey had inundated basements in areas outside the designated FEMA special flood hazard areas (SFHAs), which drive the requirement for homeowners to obtain a flood insurance policy. While such losses will unlikely be covered unless they have a flood insurance policy, the pressure to expedite claims processing in this region is likely to cause coverage leakage as frequently seen with storm surge. We expect a portion of the uncovered flood-related losses in Ida to be paid out on wind policies, especially for residential lines without NFIP coverage,” said Firas Saleh, Director, RMS U.S. Inland Flood HD Model. Total insured losses from Ida reflect property damage and business interruption to residential, commercial, automobile, industrial, infrastructure, marine cargo and specie, watercraft, and other specialty lines of business, along with post-event loss amplification (PLA) and non-modeled sources of loss. “We expect a sizable portion of the overall insured losses from Ida to be associated with post-event loss amplification. A combination of COVID-19 related impacts, including rising construction costs, labor shortages, and fewer loss inspections could contribute to economic demand surge as repairs are undertaken in the coming months. That, along with prolonged power outages will only lengthen recovery and repair times, all of which may lead to increased overall claim costs in this event,” said Rajkiran Vojjala, Vice President, Model Development, RMS. The total U.S. insured loss estimate includes US$3.8–US$6 billion losses to the NFIP, with US$1.5–US$2 billion expected to come from the Ohio Valley, Mid-Atlantic, and Northeast states. NFIP losses were derived using RMS’ view of NFIP exposure based on 2019 policy-in-force data published by FEMA, the Version 21 North Atlantic Hurricane Models, and the U.S. Inland Flood HD Model. While flood policy take-up is significant in coastal areas in the Mid-Atlantic and Northeast, some of the areas worst affected by floods during Ida have minimal (<10%) NFIP participation. RMS expects the majority of onshore insured losses from Ida to be driven by wind, followed by inland flooding, and then storm surge. Additionally, insured wind losses will be driven by residential lines, and insured water losses will be dominated by commercial and industrial lines. Insured losses to infrastructure, watercraft, and marine cargo and specie lines in Ida will be less than US$1 billion. Based on the August 2021 vintage of the RMS Offshore Platform Industry Exposure Database, and modeled ensemble footprints, RMS estimates insured losses to offshore platforms, rigs, and pipelines in the Gulf of Mexico from wind and wave damages to be between US$0.7–US$1.5 billion. Outside of the U.S., Ida impacted parts of the Caribbean, including Cuba, Jamaica, and the Cayman Islands, with strong winds, heavy rain, and flash flooding. RMS estimates less than US$100 million in insured losses from the event in the Caribbean. Ida made landfall near Port Fourchon, Louisiana on Sunday, August 29 as a Category 4 hurricane on the Saffir-Simpson Hurricane Wind Scale. At landfall, Ida produced sustained winds of 150 miles per hour (241 km/h), according to the National Hurricane Center. As Ida moved northward toward the Tennessee River Valley, it weakened and eventually transitioned to a post-tropical cyclone before impacting the Mid-Atlantic and Northeast regions with torrential rain and flash flooding. Hurricane Ida was the ninth named storm of the 2021 North Atlantic hurricane season, the fourth hurricane, and the fifth named storm to make landfall in the U.S. this season. Ida was also the fourth hurricane to make landfall in Louisiana since 2020, following Hurricanes’ Laura, Delta, and Zeta. Over two months remain in the 2021 Atlantic hurricane season, which officially ends on November 30. RMS industry loss estimates for landfalling U.S. hurricanes are comprehensive, 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 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.
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