RMS, the catastrophe risk solutions company, has revealed the forthcoming launch of a new suite of Climate Change Models to help customers assess the near and long term impacts of climate change on physical assets and their businesses.
The new Climate Change Models empower RMS’s economic modelling framework with the climate science consensus, including from the Intergovernmental Panel on Climate Change (IPCC).
The new models will be generally available in June for major peril models North Atlantic Hurricane, Europe Inland Flood and Europe Windstorm. Further models and geographies will follow this initial model suite launch. The RMS climate change solutions also include climate change specialist advisory and consulting expertise and regulatory, ESG and TCFD support.
RMS said the Climate Change Models address the perils “most impacted” by climate change and feature:
- Probabilistic modelling to capture events across different climate change scenarios
- The ability to adjust time horizons and Representative Concentration Pathways (RCPs)
- A proprietary industry and economic exposure database to deliver more accurate and impactful climate change models
- Embeddable software which integrates into existing workflows to facilitate seamless and easy operationalisation
- Consulting and additional expertise supporting regulatory submissions and activities, and providing insights from these new models today
The new RMS Climate Change Models, data, and analytics aim to help organisations:
- Understand the impacts climate change may have on capital and assets today and in the future
- Price and manage risks to better reflect changing conditions
- Confidently communicate risks posed by climate change to all stakeholders
- Comply with regulatory submissions in an efficient and sustainable way
RMS CEO, Karen White, said: ““It is clear that the financial impacts of climate change are not solely a future problem.
“The increasing incidence of wildfires, floods and hurricanes mean that climate change insights need to be incorporated into financial decisions that are being made today, in parallel with long term strategic planning and meeting increasing regulatory, environmental, social and governance (ESG) and TCFD reporting requirements, and investor and customer demands.”
She added: “This necessitates a climate change framework and models fully consistent with today’s catastrophe risk analytics and one which addresses the challenges posed by physical climate change risk and its broad impact across all relevant time scales – from today through to the end of the century.”
Eric Letourneau, SVP, group head of CAT Accumulation Management, QBE, said: “The insights on climate risk provided by RMS have enabled us to better understand climate-related risks and opportunities for our business, to report those insights to financial stakeholders, and to develop and test strategy for our business.
“We can embed these analytics in our business processes, confident that we have consistency with how we measure underwriting risk and capital requirements now and in the future.”