 "General insurers consider risk modelling for calamity covers")
General insurance companies are now looking at risk modelling and analytics for the natural catastrophe segment. This is being done through solutions provided by experts to ensure they are adequately prepared to deal with these risks.
Nymphea Batra, senior vice-president, leader - reinsurance treaty, Marsh India, said non-life insurance companies were increasingly emphasising on the use of analytics to quantify risk exposures arising from natural catastrophes. "We have an array of catastrophe modelling and risk modelling solutions that assist insurance company's at underwriting itself."
She said companies suffered losses of around Rs 10,000 crore in the past three years owing to natural calamities. According to her, the demand for reinsurance is likely to go up.
Industry experts said catastrophe modelling would enable them to make better decisions at the time of taking reinsurance. Concepts such as catastrophe bonds were also explored, but due to bad market conditions, these were not launched.
Sanjay Datta, chief of underwriting and claims at ICICI Lombard General Insurance, said the company used its internal team as well as external agencies to get information.
For retail customers, pre-structured rates based on the geography are available. Insurers will also look at area-specific risks so that those prone to incidents such as floods and earthquakes could be viewed differently. For a more sustainable market, some price correction in the underlying primary market would be required, Batra said.