international istanbul insurance conference 25 september, 2014 joe louwagie assistant vice president...

International IstanbulInsurance Conference

25 September, 2014

Joe LouwagieAssistant Vice PresidentProperty Claim Services

© Insurance Services Office, Inc. 2013, a Verisk Analytics company. Not for copying or distribution without permission.

Mission StatementPCS is committed to serving our customers and supporting the global insurance industry through the identification and provision of reliable, accurate, objective, and timely catastrophe loss estimates.

Core ValuesService

Integrity

Objectivity

Confidentiality

Transparency

Reliability

Consistency

Operating Principles We will achieve our mission by:

Exceeding service and quality expectations

Facilitating an ease of doing business

Consistently producing a high quality product

Innovating within a culture of continuous improvement

Providing value in corporate citizenship

Who We Are


U.S. catastrophe claim information since 1950

PCS formed at request of insurance industry

Loss development surveys started in 1998

Estimates based on retrospective claims review

Continual improvement amid consistency w/past

Aggregating Actual Claims Data for 63 Years

PCS HistoryServing the insurance industry


Primary insurance carriers

Marketing and Sales for agency bonuses

NOAA and governmental economists

Industry quarterly and annual reports

Catastrophe modelers

Reinsurers and reinsurance brokers

Capital markets

Providing a Service to Support the Insurance Mechanism

PCS Data UsersBroad benefit across industry and in various sectors


PCS Estimate Benefits to Insurance Carriers

CAT claim frequency

Concentration of risk assessment

Loss ratio analysis

Underwriting

Actuary

Probable Maximum Loss analysis

Risk transfer ability

Internal quality controls

Risk Mgmt.

Reserve and pricing calibration

In-house model baselining

Strengthens regulatory approval

Claims

Cat code for reinsurance

Claims quality calibration

Adjuster resource allocation


2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

3.06

6.52

3.55

10.65

7.758.95

24.4

14.39

9.95

11.812

20

13

25

18

22

19 1918

23

PCS Cat Activity 2014 Winter storms and thunderstorms

2014

Average

Thunderstorms Drive 2014 Activity

``

24 designated cats $11.8B in insured loss 5 winter storms, 1 EQ 18 Thunderstorms

24 designated cats

$16.6B in insured loss

More peril diversity

# of

Cats

(In $B)


Cat Bond Market Overview1st half 2014

$5.6 billion, 18 transactions $4.7 billion, 14 transactions

PCS data used in 36% of worldwide transactions

North American Issuance

TotalIssuance

Rest of WorldNorth America

PCSAll other

$4.7B

$0.9B

$2.0B

$2.7B


First Half 2014 IssuanceBusiest in Market History

87%

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

$662M$471M

$906M

$1.7B

$3.5B

$1.8B

$808M

$2.1B

$592M

$2.1B

$3.0B

$5.6B Historical First Half Issuance Activity


Cat Bond 2014 Trends Market diversity in geography and size

Five first time sponsors

$1.3B in fresh capital

Cat bond heavy with cat bond lite

Activity at the extremes

Continued Florida focus

Both small and large

Armor ReCitrus ReGator Re

Sanders Re

Indemnity trigger use of PCS

PCS on about 1/3 of cat bonds

http://www.google.com/url?url=http://www.everestregroup.com/Home/Careers.aspx&rct=j&frm=1&q=&esrc=s&sa=U&ei=P7y6U6ylCMu1yATwrYKQBg&ved=0CBYQ9QEwAA&usg=AFQjCNHCxDIdcqU992iLLjdcHJb1sRr3vw

http://www.heritagepci.com/

http://www.google.com/url?url=http://www.prweb.com/releases/general-contracting/tenant-improvement/prweb11454404.htm&rct=j&frm=1&q=&esrc=s&sa=U&ei=fr26U5ecGdK1yATWs4GQAg&ved=0CBoQ9QEwAg&usg=AFQjCNGF5y-vA_Mxqg81hOb1oDLZGMzryA

http://www.google.com/url?url=http://www.unuci.org/sito/agevolazioni/GENERALI.htm&rct=j&frm=1&q=&esrc=s&sa=U&ei=or26U72IC5CvyASUn4LwBQ&ved=0CBwQ9QEwAw&usg=AFQjCNEvnNvvNTjnY6NpyCUtt18_Z21iGw

http://www.google.com/url?url=http://bartoninsure.com/about-us/companies-we-represent/&rct=j&frm=1&q=&esrc=s&sa=U&ei=Db26U8X0AomNyASX4oDYAg&ved=0CBoQ9QEwAg&usg=AFQjCNFG9BgXTfePdkGUalbbcC7tuUB9sw

http://www.google.com/url?url=http://www.air-worldwide.com/Publications/AIR-Currents/2013/Uncovering-Florida-Hurricane-Risk-with-the-Catastrophe-Bond-Database&rct=j&frm=1&q=&esrc=s&sa=U&ei=-L66U5ucJtCuyASdyICACQ&ved=0CCAQ9QEwBQ&usg=AFQjCNGJfAeXTfQLyamNFGU3ai3xg1OTtg






Cat Planning and New TechnologyVerisk Climate Respond and XACTWARE Property Insight

Benefits Benefits

Enables pro-active outreach

Helps refine reserve cone

Differentiates service

Allows thousands of granular views

Supports PCS Estimates

Improves Adjuster positioning

Facilitates improved planning

Decreases response time

Enables pro-active outreach

Continuing to add perils

Peril map visuals

Aerial technology

http://www.xactware.com/en-us/


Cat Planning and New TechnologyLeveraging mapping technology from an IA perspective

Quickly Identify extent of probable damage

Matching claim size to skill level

Improves accuracy, customer service

Reduces cycle time

Overlays claims to damage

Matches before/after visuals

Improves ability to quickly assess


Dimension rooms Diagram structures Drone diagramming

How Long Before Drones Diagram Houses?

Cat Planning and New TechnologyProperty claim technology awareness

Mobile Device

Thermal Imaging


PCS InnovationApp roll-out in September 2014

PCS Innovation Driven by Customer Feedback

PCS APP

Serves a need for field access

Ready for September release

Ready for US and PCS-Canada

Facilitates future innovation

Photo upload capability in 2015


Market demand for energy and marine index

Current inability to transfer risk effectively

Responding to customer requests for PCS to review

PCS Global Energy and Marine Decision in 1st Quarter 2015

PCS Global Energy and MarinePursuit of a new PCS index (fully separate from core PCS)

Market need

Hired in April consultant to develop methodology

Commenced two working groups in July

Broad industry representation on both work groups

Will share with market prior to commencing

Project status


Daily weather monitoring

Storm and event tracking reports

Tracking of claims and insured loss

Sharing of global cat planning and response best practices

Use for reinsurance and capital markets transactions

PCS in a local marketUsing PCS to help with catastrophes

PCS Exists to Support the Global Insurance Industry


Questions&

AnswersQuestions at any time: [email protected]


Objectivity Integrity Service Transparency Reliability Consistency


Auto Cat planningProtecting your value and service

250K Flooded vehicles from Sandy

One vs. multiple tows

Salvage yard with $0 storage

Agreed re-sale fees & proper titling

Maximizing re-sale value

Storage yard volume reduces cost

Agreements with car rental agencies


PCS Cat Activity 2014Distinguishing between one and two cats in early January

January 3-5

Heavy Snow

Over by January 5th

Cat

#31

Cat

#32

January 5-8

Continual freeze in MW

Temperature rise in East

Winter Storm drives 2014 First Quarter Activity

international istanbul insurance conference 25 september, 2014 joe louwagie assistant vice president...

Documents

insurance services office

insurance industry slide

verisk analytics company

global insurance industry

b slide

pcs cat activity

transactions pcs data

insured loss