Karen Clark & Co. Introduces RiskInsight® Platform for Cat Risk Management

Boston-based Karen Clark & Company (KCC), independent experts in catastrophe risk, catastrophe models and catastrophe risk management, announced the release of the RiskInsight® open, global platform for catastrophe risk management.

The bulletin described RiskInsight has featuring “an open architecture that enables insurance and reinsurance companies to efficiently utilize the knowledge of multiple internal and external experts in building their proprietary views of risk. All components of the platform, including event intensity footprints and damage functions, are transparent to the user.”

CEO Karen Clark explained: “Building a proprietary view of risk has become more important than ever after recent model updates and surprise events. Companies want a more open platform that enables them to utilize the scientific and engineering expertise of many organizations conducting state-of-the-art research around the world. RiskInsight delivers that platform and enables the most sophisticated companies to efficiently integrate these valuable views into their day-to-day decision making.”

The bulletin noted that “RiskInsight’s built-in mapping and graphing capabilities enable companies to easily analyze their global exposures and risk concentrations. Along with built-in tools for exposure analytics, RiskInsight handles different types of event footprints and can superimpose these footprints on detailed policy and location level exposure data. Insured losses are estimated using damage functions by construction and occupancy and applying secondary uncertainty through a loss calculator that handles all types of policy conditions.”

Nicolas Papadopoulo, President and CEO, of Arch Reinsurance Ltd, commented: “We are heavy model users, but we value alternative approaches and tools that help us come to our own conclusions about our loss potential. RiskInsight provides some unique perspectives and information that complement and enhance our internal pricing and management analytics.”

RiskInsight incorporates default 100, 250 and 500-year wind footprints for US hurricanes along with damage functions by construction, occupancy, year built, and region. These footprints and damage functions are developed using the same data and information underlying the catastrophe models, but they are fully transparent and stable from year to year. They provide intuitive and consistent benchmarks for monitoring changes over time and can be readily peer reviewed by outside experts.

Glen Daraskevich, KCC Senior Vice President, pointed out that “RiskInsight is not a competitor to or a replacement for the catastrophe models. On the contrary, RiskInsight helps companies test the model results and choose the output that is most credible for their unique books of business—a best practice we use heavily in our consulting engagements.”

The bulletin said the “built-in tools complement what companies get from the models and provide new perspectives and capabilities. The information provided by RiskInsight is often more intuitive and actionable by senior executives and boards of directors than PMLs (Probable Maximum Losses) generated by the models.”

Locke Burt, President, Security First Insurance Company, noted: “While we highly value the catastrophe model output, we have long wanted a tool that enables us to monitor our exposures with a comprehensive and consistent set of hurricane scenarios. RiskInsight provides unique visibility into the relationship between our portfolio and loss potential and an efficient platform for evaluating alternative strategies and growth opportunities.”

RiskInsight comes with an industry database of detailed property exposures that is used to estimate company market shares of losses as well as exposures at high geographical resolution. Sophisticated users can create their own analytics from the built-in tools and databases. For example, default damage functions can be customized to specialized books of business, and companies can utilize their own claims data more directly than with other tools.

“Newer technologies allow our clients to gain competitive advantage by empowering them to see clearly the data and key drivers of risk and to more quickly act upon that knowledge,” Clark added. “We are very pleased to have the input and support of innovative industry leaders in designing and delivering the next generation of catastrophe risk management tools.”

Source: Karen Clark & Company