European catastrophe insurance data will be more accessible after the recent launch of two new products from the Zurich-based PERILS AG.
PERILS is an industry-wide initiative with a governance structure established to ensure industry independence.
Its founding shareholders include: Allianz, AXA, Groupama, Guy Carpenter, Munich Re, PartnerRe, Swiss Re and Zurich. Each company holds equal equity in PERILS.
It will provide two main products: aggregated industry-wide insurance exposure data (insured values), which will be catalogued by risk type and CRESTA zones (defined European geographical zones for natural catastrophe insurance) and industry loss estimates per risk type and CRESTA zones, following large natural catastrophe events.
The insured value data will be provided on an annual basis and subscribers are likely to include insurers, reinsurers, brokers, risk modelers, banks and other insurance industry stakeholders.
In a release, PERILS stated that it expects the industry exposure data and loss information will have significant value to subscribers, by improving the understanding of the potential frequency and severity of natural catastrophes at various magnitudes.
This information will in turn aid in the risk management and underwriting of natural catastrophe risk. Overall, the combination of consistent industry exposure portfolio data and corresponding event loss information is likely to enhance the modeling of natural catastrophe risk.
The greater transparency surrounding industry losses is likely to further facilitate the establishment of accurate and robust loss triggers for catastrophe bond structures,
Industry Loss Warranties (ILWs) and other capital markets products.
PERILSs loss estimates will be a welcome addition to the Insurance-Linked Securities (ILS) sector and will greatly improve insurers and reinsurers abilities to seek further capacity for peak European natural catastrophe risk.
PERILS will initially provide industrywide exposure and loss information exclusively on European wind risk (winter storms), and expand to include other perils in the future.
PERILS aims to be fully operational in the latter half of 2009, focusing initially on Belgium, Denmark, France, Germany, Holland, Ireland, Luxembourg, Switzerland and the UK. Expansion to other European countries is anticipated to follow in 2010.