Catastrophic losses in the first quarter and Solvency II are driving the need for insurers to boost their understanding of non-modeled perils, according to
Of the many illustrations of why insurers need to better understand how non-modeled perils could impact their portfolios, Aon Benfield points to the tsunamis generated by the Japan and Chile earthquakes, plus the disruption caused by the Icelandic and Chilean volcanic eruptions. According to Aon Benfield, estimates of risk must include how these perils contribute to insurance losses and how they link to modeled perils, such as earthquake and windstorm.
“It’s crucial to understand what exactly catastrophe models do and do not model,” notes Paul Miller, head of International Catastrophe Management at Aon Benfield Analytics. “In Japan, for instance, we have seen considerable losses from non-modeled sources, especially the tsunami and the knock-on implication affecting contingent business interruption. At Aon Benfield we work closely with insurers to identify and account for non-modeled perils, ensuring they have a more accurate view of their overall catastrophe risk.”
In response, the Aon Benfield UCL Hazard Centre is hosting a seminar entitled ‘
The Aon Benfield UCL Hazard Centre, a member of Aon Benfield Research’s academic and industry collaboration, is working with Aon Benfield to apply scientific and technical knowledge in model development and catastrophe management to create a more accurate picture of insurers’ overall catastrophe risk.
