TigerRisk, JBA work to enhance flood risk view for ILS & reinsurance

by Artemis on February 17, 2016

A collaboration between catastrophe reinsurance broker & risk/capital management advisor TigerRisk, and catastrophe risk modelling specialist JBA Risk Management has been announced, providing the firms’ clients in the re/insurance and ILS space with a better view of flood exposures.

U.S. domiciled TigerRisk and UK-based JBA Risk Management have announced that they will integrate their respective solutions that will provide a benefit to both the companies clients and future prospects.

TigerRisk’s proprietary reinsurance treaty pricing and portfolio management tool, TigerEye™ will be integrated with JBA’s sophisticated JCalf® catastrophe models, offering clients a more comprehensive view of flood risks.

“Our collaboration with JBA allows us to provide deeper insight and understanding of flood risk for our clients. Integrating JCalf with TigerEye means we now have a high-fidelity platform from which to advise appropriate reinsurance options to mitigate the effects of flood risk,” said Jayant Khadilkar, Partner at TigerRisk.

The collaboration and resulting integration of technologies will likely be welcomed by cedents, reinsurance companies, and importantly insurance-linked securities (ILS) players. TigerRisk is a large property catastrophe broker, therefore placing a significant amount of business with the expanding ILS and collateralized reinsurance markets.

Intense rainfall and flooding from three UK storms in December 2015 reminded the industry that even during a time of prolonged, benign catastrophe activity, an aggregation of flood events can negatively impact insurers, reinsurers, and increasingly ILS funds and managers profitability.

Furthermore, parts of the U.S. are highly susceptible to flooding events, but for a developed market penetration levels remain lower than desirable, something the new collaboration could improve as it enables a greater understanding and view of the risks, which in turn could lead to more sophisticated assessments, and ultimately more affordable solutions to the end client.

ILS is increasingly expanding its reach into new regions and perils, and combined with the rise in private contracts and collateralized reinsurance placements, ILS funds and managers are becoming ever more vulnerable to frequency losses.

“By integrating JCalf with TigerEye we are able to rapidly process more complex reinsurance structures with greater ease. The post-processing capability of TigerEye is time-saving and allows us to deliver our unique flood modeling insight with added reinsurance modeling capability,” said JBA’s Dr. Iain Willis.

Adding; “Our partnership with TigerRisk helps us provide our clients with greater reinsurance modeling capability – it means we can handle increasingly complex reinsurance terms and conditions with greater speed.”

The new collaboration serves to increase efficiency across the insurance, reinsurance, and ILS landscape, enabled by an agreement between “like-minded partners to offer holistic solutions in the risk management space,” explains Khadilkar.

JBA’s JCalf platform enables probabilistic loss assessment for a range of natural catastrophes and is utilised by entities throughout the risk transfer value chain.

By integrating the solution with TigerEye, an extremely flexible and efficient risk analysis solution that assesses the “aggregation and allocation of loss estimates and their effects on ceded or assumed reinsurance,” clients from the insurance, reinsurance, and ILS sector will benefit from a comprehensive view of flood risks combined with a facility that enables efficient, affordable, and adequate flood risk solutions.

Any advancements with modelling capabilities is typically welcomed by the industry, as the greater understanding of potential exposures and opportunities increases the ability of insurers, reinsurers, and ILS players to better manage exposures, ultimately providing more adequate, and affordable solutions.

By working together JBA and TigerRisk clients stand to benefit from a more efficient platform and holistic view of flood risk, which could lead to improved flood coverage in both developed and emerging markets, while the companies should reap the rewards of a faster, more efficient platform.

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