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NEWARK, CA – May 6, 2020 – The world is experiencing the extraordinary crisis of the COVID-19 pandemic, coupled with the never-ending climate crisis and escalating cyber threats. Markets, supply chains, economies, societies and assets can be highly susceptible to shocks and damage from these dynamically shifting risks, posing major challenges to understanding the impacts of these risks and to recovery. Today, at the annual Exceedance® conference, RMS, the world’s leading catastrophe risk solutions company, underscored the high cost that both acute and chronic risks pose while demonstrating that informed decision-making requires next-generation risk insights. To help address these challenges, RMS announced new model updates during the conference – focusing on infectious diseases, climate and cyber risk.

During his keynote presentation today, Mohsen Rahnama, Executive Vice President, Models, at RMS, compared lessons from COVID-19 to the response to climate change: “Over the last 120 days, every daily action has been critical to flattening the COVID-19 curve and has given us more data to gain insights into outcomes; similarly, climate change has gradually influenced risk over the last 120 years and will for the years to come. In turn, actions taken annually by companies and organizations will be equally critical to both understanding the totality of the risks and impacting outcomes. The effects span all parts of the insurance value chain from acute risks arising from catastrophic events, such as hurricane landfalls, to chronic risks, such as coastal flooding at high tide.”

In the same keynote, Pete Dailey, Vice President, Model Development, at RMS, stressed that science, data and models have together brought higher confidence to the relationship between climate change and insured perils. “One example is sea level, which we know, based on observations and physics, is rising globally and will continue to rise in the future. RMS is moving forward on two fronts: first, keeping cat models up to date with the latest in climate science, and second, developing new ways of projecting risk based on the future climate, in the near term as well as the long term. In addition, due to COVID-19, extreme weather events that occur this year, such as a major hurricane landfall, will potentially present a number of new challenges for insurers, such as with deployment of adjusters and claims processing, potentially while communities are social distancing. RMS Event Response services provide critical real- time insights for these types of events to help meet these challenges.”

Companies and governments are compelled to understand risks more deeply than ever before, and they need modern technology and the highest-quality, most-advanced models to accomplish this challenging task.

RMS has recently enhanced key models to help clients address the risks posed by these chronic and acute disasters.

  • RMS Infectious Diseases Model

    The RMS Infectious Diseases Model (IDM) provides a probabilistic view of loss that could result from a full range of infectious disease pandemics, including COVID-19, and epidemics ranging from influenza to Ebola. Updated most recently in the RMS LifeRisks® platform Version 2.7, the model captures the impact of infectious diseases on mortality and morbidity for multiple age groups in 59 different countries, and it considers the use of non-pharmaceutical interventions used to slow transmission throughout a population. Recent model updates capture improvements in global vaccine production and manufacturing capacity, the availability and efficacy of pharmaceuticals, country-specific pandemic response and the underlying health of an insured portfolio, leading to a better understanding of how different factors impact pandemic mortality. To assess the dynamic impact of the COVID-19 pandemic, RMS also offers projections on the number of cases, deaths and hospitalizations by region, accounting for regional mitigation measures. Clients can understand the expected impact of COVID-19 over a multi-month time horizon and get updated forecasts based on risk and response developments over time.
  • RMS Climate Models

    RMS offers robust analytics through a global suite of climate models for hurricane/typhoon, extratropical cyclone, flood, severe convective storm, winter storm and wildfire. Built on consensus science and recent empirical data, RMS models incorporate the most important aspects and recent observations around climate change to ensure a stable and dependable view of risk. New advancements with RMS Risk Intelligence™ and Risk Modeler™ 2.0 offer even greater flexibility and computational power for RMS models. Clients can analyze their book of business to measure current climate impacts including consensus trends due to climate change, leveraging either Risk Modeler 2.0 starting June 2020, their current RiskLink® solution or RMS Analytical Services. The results inform both expected and tail risks. The Europe Severe Convective Storm High Definition Models are the newest climate models to be added to the global climate model suite and are available through RMS Analytical Services now and on Risk Modeler 2.0 this summer.
  • RMS Cyber Solutions

    Initially released in February 2016 in collaboration with the Cambridge Centre for Risk Studies and eight insurance partners, the RMS cyber model has been well received in the insurance market. The very dynamic nature of cyber risk has translated to significant and regular annual improvements in the model since its very first release, most recently with the release of Cyber Solutions Version 4.0 in October 2019. Enhancements in Version 4.0 included exposure data enrichment, new hazard data, a cyber loss module and computation enhancements. RMS continues this trajectory and is making further enhancements in 2020 in its next release, Cyber Solutions Version 4.1, along with a brand new Cyber Underwriting capability, that includes rich new dashboards for simplified underwriting, which will be available by September 2020.

ENDS

Related Resources
January 25, 2023
Moody’s RMS Estimates US$5-7 Billion in Total U.S. Economic Losses from California Flooding

NEWARK, CA – January 25, 2023 – Moody’s RMS®, the leading global catastrophe risk modeling and solutions company, estimates total U.S. economic losses from the recent California flooding at US$5-7 billion. This estimate reflects inland flood impacts for the U.S. and includes damage to infrastructure. The insured losses are anticipated to be between US$0.5-1.5 billion, including losses to the National Flood Insurance Program (NFIP) and the private flood market. The overall economic loss estimate is based on an event reconstruction using the Moody’s RMS U.S. Inland Flood HD Model and reflects property damage, contents, and business interruption, across residential, commercial, industrial, automobile and infrastructure assets. A series of extratropical cyclones starting December 26, 2022, impacted the West Coast of the U.S, which resulted in heavy rainfall, overtopped rivers, flash floods, levee breaches, mudslides, fallen trees, debris flow, and heavy snow at high altitudes, together with some wind damage. The rainfall associated with these extratropical cyclones was exacerbated by a band of high atmospheric water vapor, also known as an ‘atmospheric river’. The rainfall intensity in California was so extreme that several locations in central California set new three-week rainfall records and certain locations received their annual average rainfall totals in less than one month. This led to widespread flash floods and river overtopping, for example, water depths in the San Lorenzo River upstream of Santa Cruz rose by more than 16 feet (4.87 meters) in less than eight hours. This was the highest recorded water depth for the San Lorenzo River since records began some 85 years ago. Infrastructure damage, which is accounted for within the economic loss estimates, was extensive. State highways and local roads bore the brunt of the damage due to a combination of flooding and mudslides. Trees previously stressed by dry conditions were uprooted due to high water velocities, saturated soils and heavy winds, which also caused damage to power networks, as well as to cars and properties. The continuous rainfall and compound impacts from riverine-groundwater-coastal interactions also resulted in prolonged flooding for certain urban coastal areas of California. Furthermore, the continuous drought preceding these extratropical cyclones events adds an extra dimension of complexity for reservoir operators and residents. It is important to highlight that 2022 was the second driest year in over 128 years for certain areas (e.g., Santa Cruz) and was categorized under ‘extreme drought’ according to the National Integrated Drought Information System. Although there has been a significant increase in the water levels of major reservoirs and snowpack, it remains unlikely that California is out of the drought, especially when it comes to aquifer replenishment, given the last three years of extreme drought and excessive groundwater withdrawals.  These storms generated high-intensity rainfall resulting in a high proportion of rainfall running off into the ocean, whereas aquifers generally recharge gradually from less intense rainfall systems and snow melt. “To put this event in historical perspective with the 1862 ARkStorm, although some impacted areas are similar, the ARkStorm produced much more severe precipitation, for example, 35 inches (88.9 centimeters) of precipitation in San Francisco compared to ~ 15 inches (38 centimeters) from this event. Another important mitigating factor for this event is the presence of flood defenses, which were mostly absent in 1862,” said Mohsen Rahnama, Chief Risk Modeling Officer, Moody’s RMS. A relatively small proportion of the economic damage is expected to be covered by insurance. The number of households in California with flood insurance stands at less than two percent – a figure that has been steadily declining. As of August 2022, there were only 193,281 residential National Flood Insurance Program (NFIP) policies in place, representing a decline of around five percent as compared to 2021. These low flood insurance take-up rates are attributed to the fact that only homeowners holding a government-backed loan who live in Special Flood Hazard Areas (SFHAs) are mandated to obtain a flood insurance policy. But these SFHA boundary ‘flood zones’ do not always reflect the current flood risk, are backward-looking, and are infrequently revised. Other factors impacting flood insurance take-up rates include, but are not limited to, affordability, the misconception that flood is covered under a standard homeowners’ policy, and a lack of understanding of the associated incurred cost from flooding. Firas Saleh, Director, Product Management, Moody’s RMS, concluded: “Extreme drought leads to soil compaction which means less infiltration and more runoff, hence less aquifer recharge and higher risk of flooding. Nowhere is safe from flooding in California today. If we’ve learned anything from this extreme rainfall and subsequent damage, it’s that even perceived low-risk flood zones are still flood zones. If it rains, it can overflow.”

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January 18, 2023
Intelligent Risk Platform Adoption Across Insurance and Finance Markets Passes 100 Clients Landmark

NEWARK, CA – 18 January 2023 – Moody’s RMS®, the leading global catastrophe risk modeling and solutions company, is pleased to announce that, as of the end of 2022, over 100 active clients have adopted and/or are utilizing applications and services on the Moody’s RMS Intelligent Risk Platform™ (IRP). Designed for unified risk analytics, the IRP is a software-as-a-service (SaaS) platform offering applications and services such as Risk Modeler, which enables all risk exposures to be prepared and managed in one place, ready for risk modeling, accumulation, and loss analysis using RMS High Definition™, Detailed Loss, and Aggregate Loss Models. The platform comes with application programming interfaces (APIs) available to deliver global hazard data, risk scores, and loss costs for touchless underwriting as well as real-time event response information, with applications such as ExposureIQ™ – which proved highly valuable during Hurricane Ian in 2022 – to establish the potential impact of an event on a client’s portfolio. The platform has gained significant traction among brokers, insurers, reinsurers, managing general agents (MGAs), and Lloyd’s syndicates across the globe, including Apollo, Tokio Marine, and Gallagher Re, and has also proved popular with banks and real estate asset managers keen to utilize the insights across their portfolios. The IRP removes the need to procure and maintain extensive, high-cost IT infrastructure environments required to support various risk modeling and analytics applications. Insurance and financial services clients also benefit from a quick onboarding process offering access to applications and associated models within days of subscribing. RMS risk models are available on the IRP from the latest High-Definition models, to Detailed Loss Models (DLM) and Aggregate Loss Models (ALM), using established RiskLink® and RiskBrowser® workflows familiar to the market. IRP applications are also designed to integrate with third-party and in-house systems used by insurance and financial firms to provide enhanced data insights. Clients using the cloud-based IRP have availability to the latest model data, with risk model updates integrated automatically with minimal downtime, without the requirement for maintenance and additional IT support. Cihan Biyikoglu, Executive Vice President, Moody’s RMS, said: “I am thrilled to see the great enthusiasm from our customers to the Intelligent Risk Platform. In this short period since its birth, we have customers across all major geographies, including Europe, the Americas, and Asia, and across insurers, reinsurers, and brokers modeling their accounts, portfolios, and underwriting on our platform every day. As one measure of engagement, we are already seeing hundreds of millions of commercial and residential locations analyzed daily on our platform, from earthquakes to hurricanes, and windstorms to climate change models.” “By Moody’s RMS successfully delivering a true SaaS application, clients have genuinely benefited from highly scalable automation and integration to create far more efficient end-to-end risk modeling workflows across business applications. And by clients adopting the IRP, we are also seeing an increasing number of businesses turning off their on-premises RiskLink or legacy analytics applications altogether. We look to further develop and enhance the IRP experience as the client base continues to grow and expand.”

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December 12, 2022
Ardonagh Specialty Reinforces Its U.S. Flood and Wildfire Capabilities in New Agreement With RMS

LONDON – December 12, 2022 – Ardonagh Specialty, part of the Ardonagh Group, has signed a new agreement with RMS®, a Moody’s Analytics company and world-leading risk modeling and solutions company, to broaden their adoption of the RMS Intelligent Risk Platform™ and advance Ardonagh Specialty’s risk modeling and advisory capabilities using the RMS U.S. Flood HD Model and the RMS U.S. Wildfire HD Model. The partnership spans Ardonagh Specialty’s brands including Besso, Bishopsgate, Compass London Markets, Ed Broking, Inver Re, Piiq, and Price Forbes. Antony Erotocritou, CEO of Ardonagh Specialty said: “It has always been important to us that Ardonagh Specialty strives to offer increased value to our clients. Investment in differentiating data and analytics capabilities is a core part of our value proposition. We’re excited to partner with clients and markets, creating new value, and unlocking new opportunities for the industry. By extending our long-term partnership with RMS we are confident that all our clients will continue to benefit from the high levels of service and solutions we always aim to deliver.” Michael Steel, General Manager, RMS added: “We are delighted to extend and strengthen our work with Ardonagh. Advanced implementation of RMS Risk Modeler™ can only enhance the speed, precision, and consistency across all risk decisions across the portfolio. As the increased impact of major catastrophic events such as floods and wildfires continues to evolve, brokers and insurers are keen to embrace the latest science and technology to help them better understand the risks and opportunities they face. We’re delighted to help Ardonagh service their clients with distinction.”   About Ardonagh Specialty Ardonagh Specialty is the holding company and growth platform for leading independent brokers Besso Insurance, Bishopsgate, Compass London Markets, Ed Broking, Inver Re, Piiq Risk Partners, and Price Forbes. Combined, Ardonagh Specialty has 1,400 colleagues globally and manages US$6 billion in gross written premium. With a strong presence and deep relationships worldwide, and a steadfast commitment to investing in the best people, markets, and technology, together the businesses offer open market programs, reinsurance, and international solutions designed to empower clients to achieve their strategic ambition.

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About Moody's RMS

Moody’s RMS shapes the world’s view of risk for insurers, reinsurers, financial services organizations, and the public sector, with Moody’s RMS models underlying the nearly $2 trillion USD Property & Casualty industry. Moody’s RMS empowers organizations to evaluate and manage global risk from natural and man-made catastrophes, including hurricanes, earthquakes, floods, climate change, cyber, and pandemics.

Moody’s RMS helped pioneer the catastrophe risk industry, and continues to lead in innovation, unmatched science, technology, and 300+ catastrophe risk models. Organizations can address the risks of tomorrow with the Intelligent Risk Platform™, the only open cloud with collaborative applications and unified analytics that can power risk management excellence.

Further supporting the industry’s transition to modern risk management, in 2020, Moody’s 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.

In 2021, Moody’s Corporation acquired Risk Management Solutions, Inc. and as part of Moody’s Analytics, Moody’s RMS serves the P&C insurance industry as the leading provider of expertise, science, and technology in integrated risk. A trusted solutions partner, Moody’s RMS enables 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.

© 2023 Risk Management Solutions, Inc. and/or its affiliates and licensors (“Moody’s RMS”). All rights reserved. All names, logos, and icons identifying Moody’s RMS and/or its products and services are trademarks of Risk Management Solutions, Inc. and/or its licensors or affiliates. Third-party trademarks referenced herein are the property of their respective owners.

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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