AbsoluteClimo, a climate and weather modeling, forecasting and risk management firm based in Hawaii, has teamed up with AKR Zell, a Singapore-based actuarial consultancy, with the collaboration set to deliver climate-driven risk services to the insurance, reinsurance and insurance-linked securities (ILS) sectors.
The pair have spotted an opportunity to fill gaps where standardised industry tools and risk models sometimes fall short.
These climate risk focused gaps are often the very areas of the risk markets where opportunity is seen, the much discussed protection gaps and opportunities to help major asset owners, holders and investors combat rising severe weather frequency and climate change related risks and exposures.
The two companies have announced a strategic partnership, which will seem them offering the insurance-linked securities (ILS), insurance and reinsurance industry a range of climate-driven risk services.
The range of services on offer will have an emphasis on providing independent views of risk and addressing climate- related gaps unfulfilled by traditional industry tools.
Each party brings its own specialism to the collaboration, with AbsoluteClimo having a suite of cutting edge global climate physics and machine learning financial predictive models, while AKR Zell has deep reinsurance and actuarial knowledge of existing natural catastrophe models in use across ILS, insurance and reinsurance today.
As well as this, the pair have a passion for improving risk transfer and helping the world become more resilient to climate related risks, with financial hedging tools a key solution both firms would like to make more widespread as well as increasingly accurate and robust.
“The physics of global climate change and variability, and understanding its financial impacts, benefits from a multidisciplinary specialised approach. AbsoluteClimo is pleased to collaborate with AKR Zell, which brings deep actuarial expertise and risk transfer experience to the table, to improve and address modelling gaps and discrepancies which ail the ILS and re/insurance industry,” explained Brendan Lane Larson, AbsoluteClimo Co-Founder and Climatologist.
“I have seen the pricing and analytics processes of many reinsurers. When it came to Nat Cat perils, I always felt that their ability to add seasonality was limited. AKR Zell is pleased to have found AbsoluteClimo as a partner. Their unique ability to forward-predict natural perils is providing the missing piece,” added Andreas Karl Robert Zell, Managing Director at AKR Zell Pte. Ltd.