Risk modelling firm AIR Worldwide will benefit from liability and casualty risk modelling abilities after parent company Verisk Analytics announced the acquisition of Arium, an independent company focused on liability risk modeling and decision support.
This acquisition is expected to enable AIR to provide risk modelling products and analytics for the casualty insurance and reinsurance market, so outside of its more familiar home of property and catastrophe lines, which is increasingly important as the re/insurance market are looking for opportunities to expand more meaningfully into and create new products for the casualty space.
“The industry has been searching for a platform and methodology to manage the complete range of its casualty risk,” explained Bill Churney, president of AIR Worldwide. “We believe Arium’s capabilities will allow us to do for casualty analytics what we’ve already done for property analytics, helping insurers and reinsurers comprehensively manage risk across their portfolios.”
Casualty and liability risks are increasingly a target of insurance and reinsurance firms that are expanding beyond property and other lines, as they search for more profitable opportunities and diversification.
Casualty risks also show promise as areas of emerging risk, such as cyber risks, require increasing quantities of insurance and reinsurance capital to support the industries expansion into these lines, with risk models a key tool to enable this.
“We’re excited to join the Verisk Analytics family of businesses and expand AIR’s offerings through our expertise in liability risk,” added Robin Wilkinson, founder and managing director of Arium. “Our casualty analytics platform extends well beyond product liability, enabling companies to run historical and emerging scenarios and build their own scenarios across all casualty lines to visualize how a single event can quickly spill over into other industries and their supply chains.”
“Arium is a valuable addition to the Verisk Analytics family of businesses, providing critical insurance expertise,” commented Mark Anquillare, executive vice president and chief operating officer of Verisk Analytics. “Combined with AIR’s leading models, Arium’s solutions will now enable customers to manage their extreme event risk from both property and casualty catastrophe exposures.”
Casualty risks also show some promise for the insurance-linked securities (ILS) space, as evidenced by the recent Horse Capital I DAC, motor third-party liability ILS transaction. Robust casualty risk models will enable the ILS fund manager community to more seriously look at liability exposures as new diversifying perils in years to come.