“ Insurance is transitioning from the unfashionable branch of the finance sector, to the ultimate‚ ‘community product’, enabling populations to share the costs of extreme events at local and global scales.”
Hannover Re will contribute 1 million euro
and technical expertise to the creation of the first global open-source earthquake risk model, which will provide a full spectrum of users with uniform information on seismic hazard, seismic risk and the socio-economic impacts of earthquakes.
Rui Pinho, Secretary General of GEM
Foundation, declared: “All GEM actors involved have a common mission: to improve earthquake risk modelling and assessment significantly and provide both basic and expert users worldwide with access to state-of-the art tools and software, contributing also to risk mitigation and reduction. We are very pleased that Hannover Re has taken the decision of joining this initiative, contributing and adding impetus to the ongoing endeavour, which aims at the release of a first version of the open-source global seismic risk model by 2013.”
Ulrich Wallin, CEO of Hannover Re explained:
“As a reinsurer we are keenly interested in the most reliable possible assessment of natural catastrophe risks. Through our partnership with the Global Earthquake Model Foundation we are seeking to help facilitate better assessment of the risks posed by earthquakes. The output produced by GEM could deliver valuable insights for our own risk assessment and hence enable us
to further refine our risk management and our underwriting of risks exposed to earthquakes.”
Initiated by the OECD, GEM started its operations in 2009 with the goal of constructing a global model for earthquake risks that is freely accessible worldwide.
BERMUDA SIGNS INDIA
TAX DEAL Bermuda and India have signed a Tax
Information Exchange Agreement (TIEA). The agreement, which is India’s first TIEA,
paves the way for greater financial exchange as it enables the two countries to share information on criminal and civil tax matters.
The agreement is consistent with the OECD’s
international standards for transparency and tax information exchange.
INSURERS MUST PREPARE FOR ASIAN
‘SUPERCATS’ Aon Benfield, the world’s premier reinsurance intermediary and capital advisor, is warning
insurers in Asia to prepare for future “Supercat” events like those experienced in the USA. A Supercat event is defined as generating an insured market loss of at least USD10 billion and in Asia is most likely to occur in Japan, China and South Korea.
By comparison, the USA will almost certainly continue to rank Number One in terms of Supercat losses for the foreseeable future due to the frequency of major hurricanes alone— such as hurricanes Katrina, Rita, Wilma in 2005—without even considering earthquake and terrorism-related losses.
Aon Benfield research also revealed the following Supercat loss scenarios:
• Japanese typhoon is a major Supercat peril due to its severity and frequency. Repeats of typhoons Mireille (1991), Vera (1959) and Nancy (1961) could all produce Supercat insured losses, as could a direct hit of a strong (Saffir-Simpson Category 3) typhoon on Tokyo.
• Continued strong economic growth, coupled with increasing insurance penetration, could result in Supercat losses in mainland China in the next decade. A repeat of the 1976 Tangshan magnitude 7.6 earthquake could today cause insured losses ranging
November 2010 | INTELLIGENT INSURER | 7
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