Exponential Risk is InsTech’s monthly newsletter dedicated to modelling, climate driven risk and near term forecasting insurance news.
Insights from the eye of the storm
The Brief
One of the many benefits of hosting live events is that we get first-hand and fresh insights into what is happening in critical topics such as catastrophe, property and climate. It’s also a great way to catch up with the community of people building and using models and analytics in insurance.
Our event on 1st July, sponsored by insurer Inigo, was a tremendous example of this with another packed room and 370 people interested in what is going on. It was a good chance to mark the early weeks of the 2025 hurricane season and reflect on whether we should be turning up the dial to create a Category 6 hurricane, and if so, what does that mean and is it any use to insurers?
Professor Joanne Muller from Florida Gulf Coast University presented her research in creating a new and updated view of historic hurricanes. This and other academic and insurance initiatives are becoming more vital with the threat or actual suspension of government funding for some essential services. The CEOs of two new arrivals – Mitigrate and 7Analytics – joined us fresh out of the Lloyd’s lab to explain what they are offering, both coincidentally from Norway. It’s refreshing and encouraging to see the new generation of modelling companies emerging in London to complement or offer alternatives to established analytics. We’ll be profiling more of these companies in the year ahead.
Finally, we recommend the podcast released last weekend from our interview with Garret Gray, President of Insurance Solutions for Cotality (formerly CoreLogic). He tells a powerful personal story about his family experience in the LA wildfires earlier this year.
Latest from InsTech
Exponential Risk News
Texas floods likely to have limited insured impact amid low flood coverage
Cotality reports that, despite over $1 billion USD in residential damage, the recent Texas flash floods are expected to result in limited insured losses due to low flood insurance uptake. The flooding has highlighted limitations in current forecasting and emergency response systems amid growing concerns over federal budget cuts, Previsico reports.
Hurricane Erick insured losses likely limited
AM Best expects business interruption from power outages, flooding and supply issues to drive most insurance claims in Oaxaca and Guerrero.
Previsico analysis of urban flooding in New York and New Jersey
Extreme localised rainfall on 14-15th July overwhelmed urban drainage across parts of New York and New Jersey, with modelled impacts closely aligned to observed flood locations.
TSR trims 2025 Atlantic hurricane outlook
The latest forecast revises expected Atlantic storm numbers to 15 named storms, 7 hurricanes and 3 major hurricanes. US landfall projections are now 2 hurricanes and 4 tropical storms.
US storm and wildfire losses drive $100 billion USD insured total in H1 2025
Aon’s catastrophe recap estimates H1 2025 to be the second-costliest H1 on record. The US accounted for over 90% of insured losses.
Industry Updates
HDI Global and Descartes approved for earthquake cover in Japan
The parametric product offers businesses claims based on seismic intensity thresholds, aiming to help close earthquake coverage gaps.
Aon’s updated Florida hurricane model approved for ratemaking
The certified Impact Forecasting model incorporates updated hurricane data, regional vulnerability analyses and enhanced event simulation for insurance applications in Florida.
IDF finalises parametric flood insurance design for Lagos State
The solution could provide up to $7.5 million USD in coverage. The product was delivered under the Tripartite Programme by the Insurance Development Forum (IDF), United Nations Development Programme and the German Federal Ministry for Economic Cooperation and Development, with input from AXA Climate, Swiss Re, JBA Risk Management, ICEYE and others.
Demex launches reinsurance model for frequent US storm losses
The solution provides working-layer coverage for high-frequency SCS events and is backed by over $75 million USD in capacity for 2025.
Reask launches pre-landfall tropical cyclone alert system
The email-based service delivers 1km-resolution windfield overlays generated by Reask’s LiveCyc model, providing regional alerts for developing storms across all major cyclone basins.
Previsico urges cross-sector action on flood risk
Previsico called for insurers, government and industry to coordinate on a national flood resilience strategy, emphasising the rising threat from escalating flood risks.
