AIR releases Touchstone V3.0, new features and risk model updates

by Artemis on June 22, 2015

Catastrophe risk modeling company AIR Worldwide has released Version 3.0 of its catastrophe modeling platform, Touchstone®, today. The new version brings some new features to the platform that allows insurance and reinsurance users to develop their own view of risk.

In terms of new features, Touchstone V3.0 brings comparative loss analytics to users, allowing companies to evaluate multiple sets of loss results simultaneously, including results between model versions, between different exposure sets, or using different policy terms. These types of comparisons had previously to be performed outside of the risk modeling software.

Also in V3.0 is access to detailed hazard data for simulated events, giving users of Touchstone even more insight into the drivers of loss and to further facilitate model validation as required by regulatory regimes such as Solvency II.

Touchstone 3.0 also provides expanded loss modification capabilities to allow companies to develop their own view of risk, which alongside the ability to test and compare model results will prove valuable to users.

All of these new features will prove useful to insurance-linked securities (ILS) managers and funds, as well as to those modelling for catastrophe bond issues and collateralized reinsurance deals.

“Today, more than 120 companies are benefiting from the advanced capabilities of Touchstone for catastrophe risk analysis,” commented Bill Churney, COO, AIR Worldwide. “With this release, AIR continues to execute on its technology road map by introducing important new functionality. With the new features and significant workflow enhancements, Touchstone version 3.0 offers even more flexibility, a broader range of analytics, and more efficient workflows to our rapidly growing client base. Next-generation catastrophe modeling is a reality; companies are seizing the opportunity now, not waiting, to perform more advanced analytics to better own their risk.”

With Touchstone 3.0 users can integrate non-AIR risk models, which allows the range of exposures that can be modeled in Touchstone to be expanded and brings users alternative views of risk.

In the V3.0 release, risk assessment company ERN’s Mexico earthquake and hydro models are both seamlessly integrated into Touchstone.

This ability to bring new risk models within the platform is useful for users who do not necessarily want to install multiple software platforms. It will also allow for quicker comparison of results between different model vendors.

Another new piece of functionality is the Reinsurance Submission Pack Wizard, which ensures the fidelity of reinsurance submissions by streamlining the import and export of data needed to model reinsurance submissions in Touchstone. With this functionality AIR hopes to expedite the business delays often associated with sending or receiving incompatible files within a reinsurance submission.

Touchstone 3.0 also has a new ring accumulation method as part of its Geospatial Analytics Module. The new Dynamic Ring accumulation algorithm identifies maximum exposure concentration rings using a technique that can deliver more accurate accumulations than traditional methods.

AIR says that traditional methods are often limited to finding rings with the constraint that one of the risks is at the center of the ring. The Dynamic Ring tool removes this constraint and can find the maximum exposure accumulation ring even when a risk is not located at the center.

Also, functionality within Underwriting Mode continues to expand to include new analytics and data, such as the ability to assess the marginal impact of policies under consideration and the ability to analyze additional noncatastrophe sources of loss.

“Touchstone 3.0 contains many enhancements that serve to increase transparency and usability in an already robust platform,” added Churney. “In addition to offering new features on comparative analytics and the ability to access and analyze stochastic hazard information, AIR continues to provide choice in deployment by giving companies the ability to burst to the cloud within Touchstone 3.0 during times of peak activity, opt for full deployment in the cloud, or host on premises.”

The release also brings a raft of updates to risk models providing by AIR, including updates to its U.S. hurricane model, including a new hydrodynamic storm surge module which is timely given the industries increasing focus on surge risks.

There is also a comprehensive update to the hazard and engineering components of the Canada severe thunderstorm model; new tropical cyclone and winter storm models for Canada; an expanded global pandemic model that includes coronaviruses and filoviruses; an expanded European inland flood model to include Austria, the Czech Republic, and Switzerland; an update to the South America earthquake models to include the ability to assess tsunami risk and that adds Ecuador to the model domain; and new flood hazard maps for Brazil. Furthermore, AIR plans to release an update to its Japan typhoon model to include storm surge later this year.

The updates to risk models will be of interest to ILS managers and reinsurance investors, given their focus on some core risks associated with named storms and also some expansion of models into new regions which could be helpful for diversification.

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