Insurers lack a standardized, scalable way to assess resilience to climate risk and natural hazard, meaning extreme events are powerful forces in loss experience
Conventionally
Insurance companies currently lack a proper assessment of an insured party’s resilience to climate risk and natural hazards. A lack of resilience to extreme events is a powerful force in loss experience in property, workers compensation, liability, environmental, and especially in D&O risk.
Without a standardized metric applied across geographies, and over time, underwriters are unable to adjust for a changing landscape as they make risk selection decisions, manage a portfolio of risks, and appropriately deploy risk-based capital. Businesses are unable to mitigate their risk and access optimized risk financing in the form of insurance.
Challenge
Insurers are unprepared for foreseeable, natural disaster events due to a lack of visibility into the network impacts of hazards. Business and asset owners are unaware of the depth and breadth of their businesses’ vulnerability to external infrastructure, and are consequently unable to effectively mitigate risk. The current models of assessing climate risk - GIS of the asset or business itself- provide a false sense of security, and in doing so, further expose business resilience to an ever-changing landscape of risk.
Solution
One Concern’s Digital Twin, coupled with advanced risk models, provides visibility into the dependencies to which an individual business is exposed. For the first time, we have a mechanism for a business to value an insurance offer, and through which an insurer can select and price (underwrite) this risk at scale
1C DNA Curated Data™ helps insurers understand and manage their portfolio of underwriting by filling in gaps in underlying data for their individual risks across geographies.
- 1C DNA Risk Metrics™ provide a pure scoring of resilience risk, not unlike a credit score, to accelerate pricing and portfolio management
- 1C DNA Risk Statistics™ enable clarity on margin, risk/return, and solvency capital needs and ensures selection of top tier risks, and adequate pricing of bottom tier risks.
- 1C DNA™ also facilitates portfolio-wide evaluation of climate-change scenarios. This ability to monitor on the basis of a consistent suite of analytics improves portfolio steering.