Just as insurers work toward uniformity of data transmissions on the distribution end, they should also be asking risk modeling firms to work toward uniform data standards. So says EQECAT Inc. president Rick Clinton at the risk modeling company’s recent “Catastrophe Management Summit” in Florida.”It doesn’t make any sense for all of the modeling companies to force users to adapt to their proprietary data formats to model the same exposures,” he says. “All this does is cause more work with little benefit.”Clinton says his firm is already working with U.S.-based ACORD (the equivalent of CSIO in Canada) on an open data standard. He notes that the data reinsurers received from insurers about their exposures is often inadequate due to the lack of standards. “Using a standard format will enable all parties to examine exposure data more efficiently and get a better overall view of exposure to catastrophic events,” he says. “This in turn can lead to a more favorable view of the insurer’s exposure, and a better overall program.Clinton also spoke to the rising cost of catastrophes, noting the “1 in 100 year” and “1 in 250 year” events are extracting higher and higher price tags for insurers to pay. For example, a hurricane the magnitude of 1992’s Hurricane Andrew would cause an estimated US$28-$43 billion in insured losses today. And if the 1906 San Francisco earthquake were to happen today, insurers could expect to pay US$31-$59 billion.He adds that he expects the use of catastrophe bonds to continue to grow, citing the recent report by Moody’s which pegged cat bond use in 2003 at US$1.5 billion, a 50% increase over 2002.
Calgary hailstorm ranks Canada’s 2nd-worst NatCat of all time
Calgary’s hailstorm in early August caused nearly $2.8 billion in insured damage, eclipsing the previous record for a single hailstorm ($1.2 billion) set in 2020. “This hailstorm is the second-costliest event in Canada’s history, following the 2016 Fort McMurray wildfire,” Insurance Bureau of Canada said in a release, citing data from Catastrophe Indices and Quantification […]
By David Gambrill | September 11, 2024
4 min read