Archive for the ‘Casualty’ Category



August 24th, 2016

Emerging Risks: Modeling Considerations Moving Forward: Part II

Posted at 1:00 AM ET

william-garland-sm1Will Garland, Managing Director

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Clearly, we are entering a new phase of technological advances that will bring new exposures that were not present in any historical database. For example, two areas where technology risk has rapidly become apparent are nanotechnology and drones. Chemical technology breakthroughs from nanotechnology involved in making stronger and enhanced materials may have unknown liability outcomes many, many years in the future. Drones and other technological advances remove human input into the machine’s operations.

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August 23rd, 2016

Emerging Risks: Modeling Considerations Moving Forward: Part I

Posted at 1:00 AM ET

william-garland-smWill Garland, Managing Director

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Technological progress is accelerating at a rapid pace and with it are the risks and opportunities that accompany those changes in many different segments of our economy:

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August 17th, 2016

GC Capital Ideas Top Stories: Cyber Risk, First Half, 2016

Posted at 1:00 AM ET

Here we review the most popular stories on the subject of cyber through the first half of 2016.

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August 16th, 2016

Advancing Technologies Raise Issues for (Re)insurers

Posted at 1:00 AM ET

Here we review GC Capital Ideas posts on advancing technologies that are creating new opportunities and new risks for (re)insurers.

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August 11th, 2016

Emerging Risk Exposure and Aggregation

Posted at 1:00 AM ET

Here we review GC Capital Ideas posts on the challenge for (re)insurers to identify their exposure to emerging risks and deal with the potential risk aggregation.

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August 10th, 2016

Changing View on Applying (Re)insurance to Risk Decisions

Posted at 1:00 AM ET

Here we review GC Capital Ideas posts on how the view of applying (re)insurance to risk decision making is evolving.

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August 8th, 2016

Unmanned Aerial Systems/Drones

Posted at 1:00 AM ET

Growth projections for the drone or Unmanned Aerial Systems (UAS) sector are nothing short of phenomenal, as the opportunities and advantages afforded by using this type of machinery in construction, agriculture, energy/utilities, mining, real estate, news media, film production and public safety become increasingly more apparent each passing day. Nevertheless, the potential economic benefits are considered to be vast, expecting to generate an estimated economic benefit of USD82 billion along with 100,000 jobs by 2025 (1). This rapid increase in the number of drones is prompting concerns for:

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August 4th, 2016

The Role of Risk Management in Innovation and Infrastructure Improvement

Posted at 1:00 AM ET

Here we review GC Capital Ideas posts on the role of risk management in facilitating the progress of innovation and infrastructure improvement.

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August 3rd, 2016

Utilizing Data and Models to Understand Emerging Risks

Posted at 1:00 AM ET

Here we review GC Capital Ideas posts on how the accumulation of data and utilization of models will help (re)insurers understand the implications of emerging risks.

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August 2nd, 2016

GC Capital Ideas Top Stories: July, 2016

Posted at 1:00 AM ET

1. Chart: Regional Property Catastrophe ROL Index, 1990 to 2016: The chart shows the indexes for United States, United Kingdom, Asia Pacific and Europe.

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2. China Risk Oriented Solvency System (C-ROSS): The China Insurance Regulatory Commission (CIRC) is instituting sweeping changes through its three-tiered China Risk Oriented Solvency System (C-ROSS) framework that will dramatically impact how (re)insurers conduct business. It will strengthen capital requirements, risk management and transparency disclosures - bringing China in line with, and in some cases overtaking, global standards. The C-ROSS framework is similar to Solvency II: three tiers focusing on quantitative, qualitative and disclosure requirements.

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3. Risk Profile, Appetite, and Tolerance: Fundamental Concepts in Risk Management and Reinsurance Effectiveness: Prior to the recent turbulence in the financial markets, insurers and reinsurers were increasing their use of enterprise risk management (ERM) to make risk and capital management decisions. While this was driven in part by rating agencies and regulators, many carriers began to recognize the value of metric-based frameworks and capital models in evaluating their portfolios.

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4. Cyber Gaps in Traditional Insurance Products/Standalone Insurance Products: Although the insurance market has developed a dedicated product line that addresses the initial risks faced by companies, such as data breach and business interruption due to network failure, traditional insurance products in their design have not historically contemplated the exposure to protect against cyber risks. Companies can purchase cyber specific cover in the form of extensions to traditional policies or as standalone cyber policies.

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5. Super Typhoon Nepartak: Super Typhoon Nepartak made landfall on the southeast coast of Taiwan around 22 UTC on July 7, before final landfall as a tropical storm on Mainland China around 06 UTC on July 9. Nepartak has rendered significant flood impacts both in Taiwan and Mainland China according to media reports, with at least 10 and three dead in Mainland China and Taiwan, respectively. Flood impacts have been especially severe in Mainland China, which was affected by excessive monsoon rains just prior to Nepartak.

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6. Managing Catastrophe Model Uncertainty, Issues and Challenges: Here we repeat our series authored by John Major, which focuses on the issues and challenges in managing catastrophe model uncertainty.

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7. Evolution of Risk Capital: The continued flow of new capital into the (re)insurance industry constitutes the largest change to the sector’s capital structure in recent memory. New capital has entered the market through investments in insurance-linked securities (ILS) funds, sidecars, hedge fund-backed reinsurance companies and collateralized reinsurance vehicles. Investors have increasingly been attracted to low correlation returns from catastrophe risk relative to traditional capital markets risks and the attractive yield for the measured (re)insurance risk relative to other investments, particularly in the current low inflation, low yield era.

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8. Stochastic-based BCAR: Do You Understand Your “Capital-print”?: Technology and innovation continue to change the world around us, creating both opportunities and new challenges for the (re)insurance industry. Advances in risk quantification such as predictive analytics and capital modeling, to name a few, are changing the way we underwrite, price and manage risk. Similarly, technology is allowing A.M. Best (Best’s) to advance the analytics of risk supporting its assessment of balance sheet strength. Taking advantage of stochastic modeling technology, the evaluation of risk within Best’s capital model is undergoing a fairly substantial overhaul to broaden the lens used to analyze risk relative to capital. The technology allows efficient production of multiple capital metrics adjusted for a range of risk levels rather than risk represented by just one data point, providing deeper insights into balance sheet strength, risk profile and risk appetite.

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9. Chart: Combined Ratio For Guy Carpenter Reinsurance Composite, Q1 2016: Chart presents combined ratio for the Guy Carpenter Global Reinsurance Composite, 2005 through first quarter 2016.

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10. Chart: Global Property Catastrophe ROL Index 1990 to 2016: The Guy Carpenter Global Property Catastrophe Rate on Line (ROL) index is presented for 1990 through 2016.

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