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The future of cat models
03 November 2008
Cat models are evolving to meet new risk management challenges, says Richard Clinton, president of EQECAT.
What will drive the future development and use of cat models among insurers and reinsurers?
The importance of companies understanding and managing their risk accumulations was graphically and painfully demonstrated by the recent financial crisis, which was largely driven by an under-appreciation of the risks associated with the subprime market. This lesson will not be lost on the (re)insurance industry's rating agencies, regulators and shareholders. Even before the current financial crisis these groups were already starting to require the (re)insurance industry to strengthen their enterprise risk management programmes. This will translate into greater use of cat models, including the use of multiple models. It will also drive the demand for more robust models and better risk metrics from the modelling industry.
Understanding and managing risk, especially catastrophe risk, goes to the very core of the (re)insurance industry.
How will EQECAT respond in terms of what it offers?
EQECAT has always...
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