NEWARK, CA – November 4, 2020 – RMS®, the world’s leading catastrophe risk solutions company, estimates total onshore U.S. insured losses from Hurricane Zeta to be between US$3 and US$5 bn. The estimate includes losses to the National Flood Insurance Program (NFIP) of between US$200m and US$300m.
U.S. insured loss estimates for Hurricane Zeta (US$ bn):
|Wind + Surge||NFIP||Total|
|2.8 - 4.7||0.2 -0.3||3.0 - 5.0|
This estimate includes wind and storm surge losses across the impacted states, including Louisiana and Mississippi, based on analysis of RMS ensemble footprints in Version 18.1 of the RMS North Atlantic Hurricane Model. RMS ensemble footprints are reconstructions of Zeta’s hazards that capture the uncertainties surrounding observed winds and storm surge. Losses associated with inland flooding are expected to be negligible, due to Zeta’s fast forward speed post-landfall, which kept high rainfall totals to isolated areas.
The RMS estimate includes a 5% reduction in insured onshore losses due to the cumulative impacts of Hurricane Sally, which damaged some of the same region earlier this season.
“We do expect some overlap between Zeta and Sally as the industry settles losses from these two events, but not to the degree of Delta and Laura a few weeks ago. Our Development Team found that approximately 20% of zip codes impacted by Zeta were also impacted by Sally, particularly at lower wind speeds. The overlap in the worst-affected areas of these two storms appears to be minimal. Thus, we expect a smaller loss reduction factor compared to the Delta and Laura events, largely attributed to structures in the overlapping region that sustained some, but not total damage from Sally, followed by additional damage from Zeta,” said Jeff Waters, Senior Product Manager, RMS North Atlantic Hurricane Models.
Losses reflect property damage and business interruption to residential, commercial, industrial, and automobile lines of business, along with post-event loss amplification (PLA) and non-modeled sources of loss. RMS expects most insured losses will be from residential lines.
“Power outages and treefall-driven impacts were two key factors in Zeta. The storm’s fast forward speed brought damaging winds well inland, particularly in areas with an abundance of trees, including metro Atlanta. This, combined with already saturated soil conditions, led to one of the most significant power outages of the season. Some fallen trees also directly damaged buildings and vehicles. We expect these factors to amplify insured losses.” said Rajkiran Vojjala, Vice President, Model Development.
The estimate also includes losses to the NFIP in the range of US$200 million to US$300 million. NFIP losses were derived using the RMS view of NFIP exposure based on 2019 policy-in-force data published by the Federal Emergency Management Agency (FEMA), and the Version 18.1 North Atlantic Hurricane Models.
In Mexico, RMS estimates insured losses from Zeta to be minimal. However, consistent with previous impactful tropical cyclone events this season, overall insured losses constitute a fraction of the total economic losses, particularly in Mexico which has significantly lower rates of insurance take-up compared to the U.S.
Additionally, RMS estimates insured losses to offshore platforms, rigs, and pipelines in the Gulf of Mexico to not exceed US$500m from wind and wave-driven damages. While platforms in the Central Gulf of Mexico are built with higher deck heights to negotiate wave hazard, Zeta exposed a significant number of state lease platforms to high winds and waves along the Louisiana coast. Offshore losses are based on the October 2020 vintage of the RMS Offshore Platform Industry Exposure Database.
Zeta made landfall near Cocodrie, Louisiana on Wednesday, October 28, 2020 as a Category 2 hurricane on the Saffir-Simpson Hurricane Wind Scale. At landfall, Zeta produced sustained winds of 110 mph (177 km/h), according to the National Hurricane Center. Informed by a suite of real-time observational data sources, RMS HWind products estimated comparable winds at landfall. Consistent with several previous events this season, the landfall location and timing were well forecast by the HWind forecasting products more than 72 hours before landfall.
“Despite encountering cooler waters and strong wind shear in its approach, Zeta managed to intensify before making landfall in Louisiana, nearly achieving major hurricane status. The storm’s fast forward motion–common for events that occur later in the season–reduced material water-driven impacts along the Gulf coast. However, that rapid movement brought hurricane-force winds well inland before Zeta finally weakened. In this unprecedented 2020 season, Zeta is another reminder that the season is far from over,” said Pete Dailey, Vice President, Model Development.
Hurricane Zeta was the twenty-seventh named storm of the 2020 North Atlantic hurricane season, the eleventh hurricane, and the sixth U.S. landfalling hurricane of this extremely active season. Zeta was the eleventh named storm to make landfall in the contiguous U.S. so far in 2020, and a record-breaking fifth named storm of 2020 to make landfall in Louisiana. One month remains in the Atlantic hurricane season, ending officially 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.
The technology and data used in providing the information contained in this press release are 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.
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NEWARK, CA – 19 May, 2022 – RMS®, a Moody's Analytics company and world-leading risk modeling and solutions company, announces it will be launching new global views for acute and chronic perils and their climate change impact. RMS already offers a range of regional peril and climate change models, which support detailed acute physical loss modeling products, as well as data products covering hazard and risk scores, and loss costs for individual locations, across multiple time horizons. RMS climate change models and data products have been welcomed by the market, and allow users to stress test portfolio management, risk mitigation, and adaption strategies. The newly announced global views significantly extend RMS’s peril and climate change impact coverage to provide fully correlated global views of risk, and include event frequency and severity, and analysis for current baseline and future climate views. With these new global views, RMS not only delivers a view of risk for acute peril-specific risks, but also chronic risks such as drought, heat stress, water stress, and sea-level rise. This global peril coverage will enhance RMS’s applications on the Intelligent Risk Platform™ with the Risk Modeler™, ExposureIQ™, TreatyIQ™, SiteIQ™, and UnderwriteIQ™ applications delivering global insights in the future. Michael Steel, General Manager, RMS, said: “We are continuing to see growing demand for risk insights on acute and chronic perils and climate change, from investors and corporations across many industries such as banking, commercial real estate, and insurance. The effects of these risks will unfold over many years and will have many direct and indirect implications for both industry and society. We firmly believe that long-term strategies and decision making can only benefit from detailed and analytical insight into hazard and risk impacts for present and future climates.”
NEWARK, CA – 18 May, 2022 – RMS®, a Moody's Analytics company and world-leading risk modeling and solutions company, today announces it will be releasing four new High Definition™ (HD) models, including Europe Windstorm, North America Winterstorm (WT), North America Severe Convective Storm (SCS), and Terrorism. RMS HD Models represent the next generation of risk modeling, delivering deeper analysis and granularity from Moody's. The HD probabilistic models incorporate a high-fidelity, simulation-based framework for modeling event frequency and severity, to provide a major step forward in the quality of catastrophe risk quantification. The framework allows for event footprints to be represented more realistically across larger event sets. The new RMS Europe Windstorm HD Model further enhances the current model and will cover 17 countries, adding Finland and Lichtenstein. The HD model includes a climate variability view and has expanded storm surge analytics to include the U.K., Ireland, France, and Belgium. Storm clustering will be modeled natively within the HD framework, together with an option to run the model without clustering. Industrial facilities, builders’ risk, and marine cargo will also all be covered. With the new model RMS will be able to offer a complete High-Definition solution for all atmospheric climate perils across Europe including Europe SCS HD Model, Europe Windstorm HD Model - and the Europe Flood HD Model, which was particularly relevant during the Berndt flooding in 2021. The exceptionally high insured losses from the U.S. severe winter weather event of February 2021 placed the winter storm peril in sharp focus. Both the RMS North America Winterstorm and RMS North America SCS HD Models benefit from a simulation-based framework that better represents the time-dependent nature of SCS/WT event frequency and hazard. This includes event clustering, seasonality, and the representation of cumulative hazard such as multi-day SCS outbreaks, or the cumulative snow buildup on a building due to multiple snowfalls. RMS launched its market-leading Terrorism Model in 2002, to help firms better manage exposed risks and quantify losses and casualties due to macro terrorism. As part of the suite of capabilities Moody's provides clients, the new RMS Terrorism HD Model offers increased transparency in exceedance probability (EP) generation, with outputs and analysis processes consistent with other RMS HD models. Workflow improvements include expanded financial model capabilities, multi-region selections, property and workers compensation in a single analysis, and introduces selectable causes of loss: conventional, fire only, or chemical, biological, radiological, and nuclear (CBRN). The planned general availability for the RMS Terrorism HD Model will be in 2022, Europe Windstorm HD Model in 2023, and North America Winterstorm and North America Severe Convective Storm in 2024. Julie Serakos, Senior Vice President, Model Production Management, RMS, said: “The RMS High Definition Models are delivering a step-change in risk analysis across the insurance industry. All the technological capabilities within the RMS Intelligent Risk Platform™ support the RMS HD model enhancements for clients. These model announcements build on Moody’s continued commitment to bringing reliable and precise analytics to the modelers, underwriters, the C-suite, and across the industry. RMS has always invested in leading science and technology to ensure that clients have some of the best information available to help them with their risk decisions.”
NEWARK, CA – 17 May, 2022 – RMS®, a Moody's Analytics company and world-leading risk modeling and solutions company, announces it will be launching a new application, UnderwriteIQ™, hosted on the cloud-based RMS Intelligent Risk Platform™. UnderwriteIQ enables underwriters to have greater control of risks by bringing hazard, exposure, and loss data together in the underwriting process at the point of decision – all based on RMS model science and data. The new application will allow underwriters to price with confidence, enable consistent risk decisions, and improve operational efficiency. The application is hosted on the modular and unified RMS Intelligent Risk Platform (IRP). The platform provides proprietary and tertiary data analytics to rapidly generate high-resolution risk insights via applications that meet underwriting and portfolio management needs. Moe Khosravy, Executive Vice President, Software and Platform, RMS, said: “The growth in adoption of the RMS Intelligent Risk Platform has been phenomenal. A substantial number of clients are benefiting from the secure cloud-based platform that provides superior advanced analytics through a single holistic enterprise risk management system, without the hardware and software maintenance required for on-premise offerings. IRP easily integrates into existing systems and its modular design allows users to license and use only the required applications or APIs.” UnderwriteIQ is the latest addition to the RMS IQ application suite, which also includes TreatyIQ™ and ExposureIQ™. The TreatyIQ application allows users to rapidly design and analyze both simple and complex treaty program structures, as well as import and leverage any modeled loss data, adapted to a user’s view of risk. An intuitive, underwriter-centric user experience supports customized pricing and capital metrics and can display rapid roll-up results, with analytics on aggregate positions and the performance of risk capital. ExposureIQ allows users to manage both reinsurance and insurance accumulations within one application, building structures that represent their business hierarchies in an intuitive way. The application also provides near real-time catastrophe event visualization using a powerful mapping module that directly integrates RMS Event Response and RMS HWind data. ExposureIQ makes business-wide exposure management faster and more accurate, allowing for easy identification of the key drivers of accumulations and portfolio trends, and analysis of deterministic losses across any region in the world. Michael Steel, General Manager, RMS, concluded: “The RMS Intelligent Risk Platform has gone from strength to strength since it was launched in 2018, as can be seen by its adoption across the insurance market. Powered by RMS models, science, and technology, UnderwriteIQ is a welcome addition to the existing IQ applications suite, delivering business value, end-to-end consistency, and an improved client experience. RMS plans to always continue to invest in and deliver the technology, science, and solutions that help our clients make better risk decisions.”