Let the CAT out of the Bag: a Lesson on Natural Catastrophes & Modeling-Let the CAT out of the Bag: a Lesson on Natural Catastrophes & Modeling

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Video Summary

The webinar titled "Let the Cats Out of the Bag," hosted by the Inland Marine Underwriters Association and presented by Howard Kunst, focused on natural catastrophes and their modeling. Howard Kunst, a senior modeler and chief actuary at CoreLogic, discussed various catastrophe models such as deterministic, probabilistic, and forensic models, and their applications in the insurance industry. Detailing the significance of catastrophe models, Kunst highlighted their importance in filling historical data gaps to better predict and manage risk.<br /><br />Deterministic models provide relative risk scores, probabilistic models give average annual losses (AAL) and probable maximum losses (PML), and forensic models analyze recent event footprints with advanced technology. These models are critical in areas like underwriting, pricing, portfolio risk management, and reinsurance.<br /><br />The session further delved into specific natural perils, including flood risk (coastal storm surge, riverine, and flash floods), severe convective storms (hail and wind), and wildfire. Kunst emphasized the importance of granularity in data for precise risk assessment, using geographic and structure-level details to improve model accuracy. He underscored the evolving impacts of climate change, highlighting historical increases in extreme weather events and the consequent need for robust mitigation and resilience strategies.<br /><br />Participants were encouraged to engage, with an Amazon gift card awarded for the best question. The interaction underscored ongoing industry challenges, such as the need for updated and dynamic data integration, the growing importance of AI and machine learning in model development, and the application of models in emerging insurance areas like parametric covers.<br /><br />In summary, the webinar provided an in-depth exploration of catastrophe modeling's role in managing natural disaster risks, emphasizing the need for continuous data updates and advanced modeling techniques to adapt to evolving environmental conditions.

Asset Caption

Date of Publication: August 14, 2014
Duration: 78 minutes

Learn the types of natural catastrophe models and how they are used in the industry. The presenters also focus on specific perils that are currently impacting the industry (flood, severe convective storms) and in particular how they are impacting Inland Marine risks such as builders risk and solar panels. The presentation includes a quick review of how climate change may be impacting natural catastrophe risks going forward.

Keywords

Loss Control and Claims

Loss Control & Claims

Hurricane

catastrophe modeling

natural catastrophes

insurance industry

Howard Kunst

deterministic models

probabilistic models

forensic models

climate change

risk assessment

AI and machine learning

parametric covers