From "Detect and Repair" to "Predict and Prevent"
The insurance industry is uniquely positioned to offer a perspective on resilience, since the industry’s customer engagement model is based on an advanced understanding of risk. Insurance offerings could become a framework through which resilience could be delivered and priced. However, insurance stakeholders don’t currently have the insights that they need to foster resilience in their clients and themselves, because they don’t possess a mechanism for understanding the complexities of network impacts due to climate change and extreme events.
Insurers have been trying to close the protection gap by mapping network-level risk for years, but it’s been too difficult to do. Most insurers still only assess risk based on location-level data, such as the building material of an asset or when it was built, and historical information on natural disasters rather than predictive models. This approach leaves both customers and insurers exposed to unexpected losses due to extreme weather and climate change.
To close the global protection gap in coverage, insurance needs to use digital tools to move beyond a reactive “detect and repair” framework to a forward-looking “predict and prevent” framework. The insurance industry needs to evolve beyond assessing only building risk to holistically measure resilience, transforming the industry to consider the true risk profile of assets and communities. This evolution has to meet the needs of customers who are demanding change, such as business owners who are increasingly frustrated with the nature of traditional interruption coverage and pressuring insurers to provide network coverage.
Insurers can take an active role in driving community resilience once they are no longer held back by the limitations of traditional risk assessment, whether that takes the form of advisory to clients, underwriting, pricing or new insurance products. Insurers will be able to identify the relationship between business resilience and loss ratios across levels of risk, allowing them to properly integrate resilience throughout their operations.
How we'll get you there
One Concern’s platform unlocks the advanced risk intelligence that insurers need to change their approach. Our digital twin offers visibility into the reality of dependencies like power and transportation, and allows users to visualize the impacts of extreme weather both now and into the future through our predictive, forward-looking models. One Concern also offers resilience metrics that can be applied both across geographies and over time, enabling insurers to adjust their offerings for a constantly changing landscape.
One Concern enables insurers to assess risk more comprehensively than ever before. Insurers already have the technical knowledge and credibility with customers needed to become resilience leaders. They just need the right tool to quantify externalities. Our platform offers that tool.
- 1C curated data helps insurers understand and manage their portfolio of underwriting by filling in gaps in underlying data for understanding their individual risks benchmarked across geographies, ensuring selection of top tier risks, and adequate pricing of bottom tier risks.
- 1C risk metrics provide a pure scoring of resilience risk, not unlike a credit score, to accelerate pricing and portfolio management.
- 1C risk statistics enable clarity on margin, risk/return, and solvency capital needs to ensure selection of top tier risks, and adequate pricing of bottom tier risks.
- One Concern DNA™ also facilitates portfolio-wide evaluation of climate-change scenarios. This ability to monitor on the basis of a consistent suite of metrics improves portfolio steering.