June 14th, 2017

Analytics: Fueling Risk-Informed Decisions: Part II: Portfolio Analytics

Posted at 1:00 AM ET


Tim Gardner, President, North America


With robust portfolio analytics, including advanced actuarial and catastrophic risk modeling, insurers are able to manage portfolio risk with confidence. Notable new portfolio-based models are being used for emerging areas such as casualty catastrophe and cyber risk assessment. Significant advances in sub peril modeling, such as for flood, have also transformed previously non-modeled perils into modeled perils, greatly improving knowledge and underwriting decisions in many regions.

Companies’ active understanding of catastrophe modeling results has become increasingly critical as they are used in a growing array of business decisions. Through model sensitivity analysis, loss validation and comparison of critical model assumptions to academic and other scientific data, companies can now better understand the significant assumptions inherent in catastrophe models. The analytic results provide senior management with the requisite level of confidence to accept, recalibrate, bend or blend the catastrophe model results.

Among portfolio analyses, mapping-based visualization, portfolio management and pre/post catastrophe response are each rapidly changing and evolving - a number of new providers of geo-spatial layers, ranging from terror targets to soil composition for earthquake analysis, are offering better accumulation management support. In the claims response area, new providers of weather data are including live-feeds and offering advanced warning of areas of potential impact. Drones, satellite feeds, crowd sourcing and other new alternatives are now routinely utilized to capture event “footprints.” With the large number of risk management tools available in the marketplace, insurers are increasingly relying on their reinsurance intermediaries to help evaluate these providers and guide their understanding of which solutions are the most credible.

These advances in analytics support the ability to transparently design and optimize reinsurance solutions - Guy Carpenter’s GC AdvantagePoint® is an advanced risk analysis and visualization platform that helps clients translate vast amounts of data to better understand risk exposures and the impact of growth strategies as well as plan and respond to catastrophic events.

Link to Part I>>

Link to Part III>>

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