The Impact of Changes to the RMS U.S. Hurricane Catastrophe Model

Permanent Link:: http://dpanther.fiu.edu/dpService/dpPurlService/purl/FI15050397/00001

Material Information

Subjects / Keywords:: climate change
hurricanes
catastrophes
unknownAtlantic region

Abstract:: In May, Risk Management Solutions, Inc. released a newly calibrated catastrophe model for Atlantic tropical storms that has dramatic implications for property insurance capacity, underwriting, and pricing. The revision reflects a re-examination of the factors that drive the RMS hurricane model based on newly available data and analysis in the wake of record storm seasons in 2004 and 2005. The new model projects greater potential losses based on an increase in Atlantic hurricane activity, new assessments of building performance and a more detailed understanding of how a confluence of circumstances amplifies losses in a severe catastrophe. The revisions in RMS RiskLink 6.0 will accelerate a shift that is already under way in the property insurance industry as primary carriers and reinsurers reevaluate their exposure. During this period of transition, the property specialists at Napco will use risk assessment capabilities, market intelligence, and relationships with underwriters to ensure that our partners in the agent/broker and risk management community experience as little disruption as possible. This report summarizes the major changes in the RMS hurricane model and how they will impact retail agents and brokers and their clients.

Source Institution:: Florida International University
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