Earthquake models for Latin America should be a focus for Risk Management Solutions (RMS) at its Exceedance event in Miami this week, Capsicum Re has suggested.
Ian Scott, senior modeller at the London and Bermudian reinsurance broker told Reactions he wanted to see more done in the space, particularly looking towards liquefaction and fire following earthquakes.
“Rather than expanding into new territories across Latin America, I feel that as the primary peril in LatAm is earthquakes, I would like to see the current earthquake models updated, ensuring sub-perils such as liquefaction and fire following are addressed,” Scott told Reactions.
He noted related recent updates by Mexican cat modeller ERN as well as Boston-based modeller AIR Worldwide.
“RMS’ new HD peril models appear to be focused elsewhere in the World,” said Scott.
“After updating the earthquake models, it would be very useful for detailed flood maps and probabilistic flood models to be developed across the LatAm region,” he said.
Speaking about the relevance of model outputs amid patchy data and pricing pressures, he noted that as updates are tested and peer reviewed, loss predictions’ accuracy should improve, adding more relevance to models’ results used in Latin America’s growing re/insurance market.
“The increased focus and investment in the region will feed through into the market and gradually influence the prices more than just pure market forces,” said Scott.