Risk modelling and analytics specialists RMS has announced an expansion of its offering with the addition of new India and China agricultural risk models and plans to expand coverage of its agricultural models across Asia-Pacific and the Americas.
RMS sees the expansion of agricultural risk models as a core element of its mission to help clients access new sources of insurance and reinsurance risk, helping to close the protection gap with the help of advanced technology.
“RMS is very well positioned to develop agricultural risk models and help ramp the industry’s understanding of the risk,” commented Mohsen Rahnama, chief risk modeling officer and general manager of the RMS Models & Data group.
“We understand the framework and principles of the models, and will combine our 30-plus years’ experience in climate hazard modeling with the latest data collection and processing technology, and scientific understanding of the risk, to build the next generation of agricultural risk models for the industry. Also important is the modeling work we do that lies outside our long-established analysis of catastrophe risk for the insurance industry; the recent conclusion of our drought stress-testing project for the banking industry has given us deep insight into the drivers of water scarcity, which is a key hazard for agricultural risk,” Rahnama continued.
To enable more rapid expansion of RMS’ agricultural risk model services, parent company DMGT is transferring the model assets from its AgRisk business to the risk modeller. RMS aims to provide a complete agricultural risk management service for local and global insurance and reinsurance firms, including high-touch modeling support, analytical services, training, and event response.
“Countries throughout Asia-Pacific are experiencing rapid growth. RMS is committed to helping our clients’ success in these dynamic markets by providing a comprehensive suite of risk and analytics solutions,” added Steve Hurcom, senior vice president, client development Europe and Asia. “Agricultural risk is one of the top concerns and big opportunities for our clients in Asia-Pacific and Latin America, and they need robust models to manage the risk as part of their overall enterprise risk.”
RMS targets Asia-Pacific and Latin America as key strategic markets, recognising the opportunity to help the insurance and reinsurance industry expand further with the support of advanced risk models, helping to close coverage protection gaps.
RMS said it is set to release “significant modeling capability this year for local and global clients writing business in these regions.”
The new India and China agriculture risk models are available as of today and RMS will quickly follow this up with a range of catastrophe risk models targeting the region as well as updates to existing models.
In April RMS will release updated earthquake models for Indonesia and the Philippines; four new earthquake models for Singapore, Malaysia, Thailand, and Vietnam; in addition to wind and typhoon models for Taiwan and South Korea.
Also coming in the RMS model development pipeline are updates to the views of risk for marine and North Atlantic hurricane covering the Latin America region.
Asia-Pacific agricultural risk will be of interest to the insurance-linked securities (ILS) market, as ILS fund managers already underwriting agricultural reinsurance on a collateralised basis may see this as an opportunity to gain a new diversifying risk and region.
Risk model expansion into risks that are often largely uninsured will benefit not just the insurers and reinsurers, but also the population in the regions covered. The availability of risk models will help to support the reinsurance needs of primary insurance such as agricultural index-insurance, perhaps enabling these schemes to become more effective and broadening their roll-out as well.