RMS, a US-based catastrophe risk modelling specialist, has rolled out its latest risk model solution that will enable re/insurer to deal with wildfire risks in the country.
Known as the RMS U.S. Wildfire High Definition (HD) Model, the new offering is said to be the most comprehensive solution in the market.
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The HD Model offers an improvement on zoning and mapping products which are currently being used by the re/insurers to evaluate wildfire risk.
Capturing the full impact of wildfire at high resolution, the new system provides a better understanding of the complex behaviours that describe fire spread, ember accumulation, and smoke dispersion.
It also simulates more than 18 million wildfires across the contiguous US, and allows users to gain more granular and comprehensive approach to underwriting and portfolio management.
RMS senior director of product management Chris Folkman said: “The past five years have demonstrated that the industry needs better ways to manage their wildfire risk comprehensively: for underwriting, for reinsurance purchasing, and for capital management.
“After three consecutive seasons with major cat events, it’s clear that wildfire needs to be treated more like a peak peril and less like a simple matter of attritional loss.
“Wildfire risk has a steep gradient, where different houses in the same neighbourhood can have drastically different risk profiles. We’re confident our analytics can equip property writers to price, underwrite, and deploy capital with precision – for any contiguous US location.”
RMS teamed up with a number of insurers, mitigation experts, and government agencies to obtain data and related information required building the model.
It is estimated that wildfires have caused over $30bn in claims and five of the 10 most destructive wildfires ever have happened in 2017 and 2018.
