CelsiusPro AG, the Swiss headquartered weather index insurance and parametric risk transfer specialist, is doubling down on the use of big-data and advanced technology to create better parametric triggers and indices for weather and natural catastrophe risk transfer.
CelsiusPro is already a technology-focused company, calling itself an insurtech as it has placed an increasing emphasis on the role of advanced technology and software in analysing risk and environmental data, to create better, more responsive index and parametric triggers, which are at the heart of the solutions it provides.
Now, CelsiusPro has completed development of a big-data platform specifically for use in creating and monitoring parametric risk transfer triggers, which could be used in hedging, such as in the weather risk management market, or in insurance and reinsurance products.
CelsiusPro says it has developed and implemented what it calls, “the most advanced architecture and technology platform for event-based stream processing of global environmental data.”
The company explains, “Environmental data is the key element to unlock the index-based insurance market for weather and NatCat perils. CelsiusPro’s data base contains all relevant climate data worldwide, and in order to calculate the required metrics, big data is needed. To retrieve and handle the mass of data in an optimal and efficient way, CelsiusPro has developed a new high-tech data architecture platform. The key steps have been successfully implemented, further optimization is ongoing.”
The system provides access to more than 30 different regional and global environmental and weather data sets, including over 20 meteorological and environmental parameters such as precipitation, earthquake, tropical cyclone, vegetation indices and wildfires.
An astonishing more than 180 million new datapoints are being loaded into the data base every day by CelsiusPro, with the number of regions covered and parameters also increasing.
CelsiusPro uses the data for real-time climate monitoring, as well as interpretation and risk analysis, the visualization of climate, vegetation and NatCat data, ande detection of tropical cyclone paths, anomalies, vegetation deficits, and more.
Sebastian Glink, Director Business Development & Technology at CelsiusPro, explained, “We have designed and implemented an optimized and scalable Big Data Lambda Architecture for the entire data processing. The fundamental change to the previous architecture is the switch to event-based stream processing, created on a series of data points using a cloud-based Kafka Cluster as a central data hub.”
The data and technology is available to clients looking to create index and parametric risk transfer solutions, hedged, insurance or reinsurance, and it’s available via CelsiusPro’s White Label Platform for its insurance clients around the world, who can use it for pricing and settlement of parametric insurance products.
CelsiusPro has expanded its focus more broadly now than where it was a few years ago, on structuring and originating weather derivatives and weather risk management products, to now also creating technologies that can support advanced index-based and parametric risk transfer solutions.
It’s a sign of the weather risk management market and parametric insurance catching-up with advancements in technology, which promises to make the triggers more highly customised and calibrated to protection buyers needs, the pay-outs more real-time in nature and the coverage provided more responsive to what clients actually experience, all of which can ultimately help to make better risk transfer products and also minimise any basis risk that might be perceived to exist.