The "one-two" punch of Hurricanes Charley and Frances will test technology used by insurers to forecast insured losses from catastrophic storms. Some recent commentary and information about such technology includes the following links. If you know of additional technology that's proven useful or is promising, or critical analyses of such technology, please comment, trackback or email me at: doug "at" dougsimpson.com. This implies no endorsement of any product or report mentioned below, and I have no affiliation or relationship with the vendor of any product mentioned. Comments will be closed soon to reduce spam.
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"While nobody can eliminate natural or market forces, insurers are turning to business geographics to minimize their impacts in underwriting, ratemaking, risk concentration analysis, marketing and disaster recovery."
This 2002 article mentions:
"StormCenter Communications, Inc. and Accurate Environmental Forecasting, Inc. have teamed up to deliver a new hurricane forecast model that has been used at the National Hurricane Center and in some selected private industry locations for more than 5 years. * * * A key differentiator with the RealTrack(TM) Hurricane Model is the production of combined AEF/AIR real-time loss estimates which provide the most accurate assessment of potential risks for all landfalling hurricanes along the U.S. coastline."
"Experts Team Up to Deliver the RealTrackTM System via the Web" (Envirocast 2003).
"[S]kilful long-range forecasts of seasonal US hurricane activity could be used either to create an additional profit margin for a seller of reinsurance coverage or to reduce costs for buyers of coverage. * * * Several ideas and developments have been combined to demonstrate the business relevance of seasonal US hurricane forecasts for the first time."
Niklaus Hilti, Mark Saunders and Benjamin Lloyd-Hughes, "Forecasting Stronger Profits" (GlobalRe, 2004)(PDF).
"Founded in 1987, AIR pioneered the probabilistic catastrophe modeling technology that revolutionized the way insurers, reinsurers and financial institutions manage their catastrophe risk. Our leading edge models of global natural hazards, which form the basis of our software systems, enable companies to identify, quantify, and plan for the financial consequences of catastrophic events."
"About AIR," a subsidiary of Insurance Services Office (ISO).
"The AHC [Atlantic Hurricane Catalog] is a new hurricane event set that brings unparalleled technological sophistication to the science of hurricane risk assessment."
"Incorporating Climate Variability and Numerical Weather Prediction Technology into Hurricane Risk Assessment" (Accurate Environmental Forecasting, Inc., 2004)
"AEF's sophisticated modeling technology is coupled with intuitive interactive visualization software to allow rapid and effective use of our forecasts. "
"Hurricane Modeling > Overview" (Ibid)