Catastrophe modeling firm AIR Worldwide (AIR) announced it is collaborating with RenaissanceRe, a global re/insurer, as part of a joint effort to enhance the industry’s modeling of long-tail casualty risk.
“Since our inception, RenaissanceRe has been at the forefront of applying science, engineering, and data to inform our independent view of risk,” said Ian Branagan, senior vice president and group chief risk officer at Bermuda-headquartered RenaissanceRe.
“Incorporating third-party expertise from proven leaders such as AIR wherever appropriate is a key part of this process,” Branagan added. “We’re pleased to work with AIR to advance our industry’s ability to better understand how to model and manage casualty and specialty risk.”
As part of the collaboration, AIR is producing portfolio-specific casualty losses based on its exposure management application, Arium, said Boston-based AIR in a statement.
Arium’s scenario-based loss assessment framework enables companies to measure portfolio loss potential and exposures to simulated scenarios representing both emerging risks and forward-projected historical events, the company explained.
“We’re currently developing the industry’s most comprehensive model of liability risk to help companies understand the complex interconnections in their portfolios, resulting in a comprehensive assessment of potential future losses,” said Dr. Jay Guin, chief research officer, AIR Worldwide.
“Collaborating with a global leader in risk management like RenaissanceRe is a great step forward in the development of our stochastic model,” added Guin. “This model provides a forward-looking view of risk and will enable insurers and reinsurers to capture the full distribution of the frequency and severity of casualty catastrophes.”
“Arium is a powerful exposure management application designed to help companies evaluate liability accumulations and run casualty risk scenarios,” said Robin Wilkinson, vice president and managing director of casualty analytics at AIR Worldwide.
“With Arium, insurers can analyze and quantify their exposure to simulated liability events and become more informed on what types of future events could cause significant losses to their portfolios,” continued Wilkinson. “As Arium continues to evolve, the stochastic model will enable companies to understand and manage their casualty risk more thoroughly.”
Source: AIR Worldwide
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