Catastrophe (CAT) Analytics

CAT Analytics We provide CAT Analytics so you can make informed decisions.

Catastrophe Analytics

Catastrophe (CAT) Analytics uses a computer-assisted complex of algorithms to calculate the estimated losses that you could sustain due to a CAT event such as a hurricane or earthquake. In addition to loss probability, we infuse specific details, including the age, construction, and geographical landscape of your organization or business to formulate and evaluate your ultimate financial risk. We provide CAT Analytics so that you can make an informed decision about the limits, retention levels, and whether to retain, mitigate with loss control, or contractually transfer your risk through insurance.

CAT Analytics loss estimates assist with:

  • Managing areas of high exposure to catastrophic loss
  • Estimating consistent and reliable loss control for all locations
  • Developing data to effectively negotiate property insurance terms and conditions
  • Purchasing appropriate limits
  • Demonstration of sound risk improvement practices

Don’t misinterpret return periods

  • Hurricane Katrina was 1 in 20 year hurricane loss for the U.S. - inaccurate
    • There is a 5% annual probability that a Katrina-sized hurricane loss could occur in the U.S. - Accurate

Perils that we model:

  • Earthquakes
  • Flood
  • Storm Surge (Independent of or Included in Tropical Cyclone Mode)
  • Terrorism
  • Tropical Cyclone (Hurricanes or “Named” Windstorms)
  • Wildfire
  • Wind (Tornado, Hail, Straight-line Windstorms, etc.)

We can run CAT Analytics with varying policy terms to determine the appropriate limits, deductibles, and excess layers that will allow us to:

  • Allocate pricing to individual locations
  • Negotiate rates with insurance companies
  • Negotiate required insurance limits with lenders

An example of client savings

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Concern

A large private college was using a single address for 42 campus buildings. Additionally, the college's property schedule had holes in information regarding roof updates on buildings dating back to 1830. Property insurance was expensive with a high wind deductible.
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Cadence Insurance Solution

We worked to "geocode" each building on campus, mapping each structure's latitude and longitude. Next, we modeled the risk by converting one address into 42 distinct points. Finally, we ensured that we obtained year of update/replacement information for all building roofs.
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Impact

Having valuable data to approach underwriters with resulted in a rate reduction of 44%, taking the pure premium from $738,000 down to $440,000. Better CAT Analytics results also allowed us to negotiate the wind deductible from 5% down to 2%.

Connect

Let one of our seasoned risk advisors assist you today.
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