Featured speakers at the Instech-Nasdaq Earthquake Risk - a Global Challenge webinar
More than 400 online participants joined InsTech’s Earthquake Risk - a Global Challenge webinar on March 4. Facilitated by Matthew Grant, the speakers explored how insurance losses from earthquakes are measured and managed through the use of catastrophe models; how to access models through platforms provided by companies such as Nasdaq and Oasis; and key points on understanding the choices available when using catastrophe models.
The event, organized with the support of Nasdaq, featured speakers James Sawle, Nasdaq Risk Modelling for Catastrophes; Matthias Schmid PhD, Guy Carpenter; Goran Trendafiloski, Impact Forecasting; Mohammad Zolfaghari, CatRisk Solutions; David Gregory, Corelogic; Mario Ordaz, ERN and RED; and GEM Secretary General - John Schneider.
John shared GEM’s organizational setup and described its suite of global hazard and risk models. John touched on the collaborative approach of GEM in validating models from actual losses emphasizing that working with local experts had always been a key GEM approach.
John explained that GEM collaborates with Nasdaq for its platform of insurance risk models and its connection to the financial risk market. However, he reiterated that the revenue that GEM would eventually receive from the commercial models would be reinvested in public-good activities, with particular focus on the developing countries - to help develop a better understanding of risk and help with risk reduction activities.
John also underscored that what sets GEM’s models apart from the others is transparency, openness – characteristics that give modellers an inside view of how risk is calculated.
Responding to a plenary question on how GEM views the future of risk modelling, John said that “… there is definitely an appetite to have more openness, more transparency, more access to information. There is definitely an appetite for more variety and ability to compare models, and not just to compare different black boxes but to actually understand what’s inside.”
The speakers and panelists also agreed this emerging topic is not only true for the insurance industry but also across governments. As John noted in his presentation, “governments are putting people in place to understand the science and the engineering, and are trying to communicate with policy makers”.
He concluded that the trend is moving towards a more holistic approach to risk management, and that it’s what GEM foresees to be happening more and more in the future.
The premise of the webinar is concentration of existing catastrophe models in areas with the largest insured losses such as the United States and Japan. The organizers posit that the impact of earthquakes in other areas of the world, where mainstream models are less developed, can also trigger major losses. With the support of Nasdaq, InsTech London brought together specialist model developers from around the world to review what they are offering and get their views on key developments to look forward to in this field.
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