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Insurer partners with modeling firm to create marine catastrophe model

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Sompo Canopius A.G. said Thursday that it has partnered with Risk Management Solutions to create a marine catastrophe model.

RMS and Sompo Canopius have been Joint development partners since 2015, RMS and Sompo Canopius have joined with Chubb Ltd., Aon Benfield Group Ltd., Axis Capital Holdings Ltd., Liberty Mutual Holding Co., MS Amlin and Munich Reinsurance Co. to develop this model, compile data and build and calibrate models to better assess cargo vulnerability and specie, particularly in product classification, storage and packaging, Sompo Canopius said in a statement.

“Significant marine losses such as the 2011 Tohoku (Japan) earthquake, 2012 Hurricane Sandy (in the Caribbean Sea and U.S.) and the 2015 Tianjin (China) explosion have improved the understanding of the link between property and marine lines of business. They have also reinforced Sompo Canopius' belief that the approach to catastrophe management should be holistic across our group. The practice of square pegging marine exposure into the round holes of property catastrophe risk models is now recognized as inappropriate. A new approach is needed to align these correlated classes and our collaboration with RMS represents a key step on this journey,” Marek Shafer, head of catastrophe management at Sompo Canopius, said in the statement.