AAE News

Underestimating tail risks from climate change

14 September 2023

WHY NATURAL CATASTROPHE FREQUENCY-SEVERITY ADJUSTMENTS UNDERESTIMATE TAIL RISKS FROM CLIMATE CHANGE

by Cameron Rye

Cameron Rye is Head of Modelling Research and Innovation within the WTW Research Network.

Climate scenario analysis has advanced significantly in recent years, with many insurers now adjusting natural catastrophe models to explore how physical risks could change over the coming decades. Extreme weather events – such as windstorms, floods, and wildfires – are projected to become more frequent and severe in many parts of the world. As a result, actuaries, catastrophe modelers, and regulators have focused their attention on methods for modifying frequency-severity relationships.

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Disclaimer:

This article represents the opinion of the author, and not necessarily the opinion of the AAE.

This article was published in The European Actuary No. 35 – September 2023

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Dorothea Diers and Michael Schüte expect a lot of work for insurance companies

12 September 2023

SOME THOUGHTS ON NAT CAT AND INSURANCE POLICIES

by Michael Schüte and Dorothea Diers

Michael Schüte – works as an actuary for Helvetia Schweizerische Versicherungsgesellschaft AG and is member of the German Association of Actuaries (DAV) since 2004. He chairs the DAV working group on Climate Change. Furthermore, he is a lecturer for insurance mathematics at the University of Marburg, Philipps-Universität.
Dorothea Diers is Head of Capital and Risk Management at Provinzial Group, Germany. She is member of the German Association of Actuaries (DAV) since 2002 and chairs the working group Non-life Risk Models. Furthermore, she is apl. Professor in Actuarial Science and Enterprise Risk Management at Ulm University.

 

When we talk about climate change we have to consider that climate change will have an impact on the frequency and the severity of significant Nat Cat events. A rising temperature has an effect on the possibility of storing and transporting water in the sky. A change in the classical streams can induce stable weather situations with steady rain over several days.

Read the full article here.

 

Disclaimer:

This article represents the opinion of the author, and not necessarily the opinion of the AAE.

This article was published in The European Actuary No. 35 – September 2023

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Bridging the insurance gap means a global challenge for financial resilience

7 September 2023

BRIDGING THE INSURANCE GAP – A GLOBAL CHALLENGE FOR FINANCIAL RESILIENCE

by Monika Lis

Monika Lis – is manager at Milliman, Warsaw, Poland
 

The insurance industry plays a crucial role in safeguarding individuals, businesses, and economies against unforeseen risks. However, despite the widespread availability of insurance products, a significant portion of the global population remains exposed to financial vulnerabilities due to the insurance gap. The insurance gap refers to the disparity between the actual insurance protection in place and the level of coverage needed to mitigate risks effectively. This article explores the multifaceted nature of the insurance gap, its impact on global economies, and the efforts to bridge this critical financial divide.

Read the full article here.

 

Disclaimer:

This article represents the opinion of the author, and not necessarily the opinion of the AAE.

This article was published in The European Actuary No. 35 – September 2023

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How to develop strategies for natural catastrophes

5 September 2023

DEVELOPING STRATEGIES FOR NATURAL CATASTROPHES

Interview: Marie Scholer by Jennifer Baker

Marie Scholer – is chairman of the NatCat Expert Network since 2019. She has written consultation papers on sustainability. She has also developed the Protection Gap Dashboard of EIOPA and is also currently (re)assessing the parameters of the standard formula for NatCat.
 

Can you explain what the goals are of the EIOPA Expert Network on Catastrophe Risk? How does the network intend to achieve these goals? ‘Firstly, the network is composed of experts on natural catastrophes from industry, model vendors, academics and also other EU institutions. And the main goal of this network is to contribute to the EIOPA initiative regarding modelling and mitigation of natural catastrophe risks, as well as climate change…

Read the full article here.

 

A video of this interview is now available on actuview:

 

Disclaimer:

This interview represents the opinion of the interviewee, and not necessarily the opinion of the AAE.

This article was published in The European Actuary No. 35 – September 2023

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New edition of The European Actuary

1 September 2023

Issue 35, September 2023 of The European Actuary has been published.

 

The theme of this issue is: Catastrophe risks

Featured Articles:

  • Developing strategies for natural catastrophes | Interview with Marie Scholer
  • Bridging the insurance gap a global challenge for financial resilience | by Monica Lis
  • Some thoughts on Nat Cat and insurance policies | by Michael Schüte and Dorothea Diers
  • Why natural catastrophe frequency-severity adjustments underestimate tail risks from climate change | by Cameron Rye
  • AAE position on IORP II directive | by Tatiana Bitunska and Philip Shier
  • EAD 2023  – a successful European Actuarial Day, with opportunities for improvement | by EAD 2023 Organising Team
  • Catastrophe| column by Loudina Erasmus

 

Please visit the webpage of The European Actuary on the AAE website for prior issues or further details.

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