The Open Exposure Data Standard will also lower barriers of entry for model developers – including commercial vendors, third-party data providers and academia and other research institutions. Initial testing on reinsurance placement data for Japan, Australia and China has proved highly successful as the initiative broadens its area of focus.
Aon plc, a leading global professional services firm, on Monday announced the implementation of the Open Exposure Data (OED) Standard curated by Oasis for the risk modelling of property reinsurance placements.
Led by Aon and reinsurers RenaissanceRe, SCOR, Hannover Re and Swiss Re, the OED Standard is a non-commercial venture designed to test and support the hypothesis that open data standards in risk modelling are more effective than proprietary and commercial standards in terms of improving operational efficiency, reducing costs and increasing transparency and consumer choice.
The OED Standard will also lower barriers of entry for model developers – including commercial vendors, third-party data providers and academia and other research institutions. Initial testing on reinsurance placement data for Japan, Australia and China has proved highly successful as the initiative broadens its area of focus.
Dan Dick, executive managing director and global head of property analytics for Aon’s Reinsurance Solutions, said: “Aon is proud to be part of this important initiative, which will serve to help reduce volatility in data assumptions, improve consistency in modelled output and increase the operational resilience of our clients and markets. This announcement exemplifies the ways in which our industry is making a positive impact in our communities and for our fellow citizens, by collaborating and focusing on critical issues where we can apply our energy and expertise to make a meaningful difference by informing better decisions.”
The re/insurance industry collaboration is designed to promote equality and inclusion when accessing critical risk information, allowing communities globally to become more risk-aware and risk-informed, while improving their resiliency and ability to save lives.
Ian Branagan, EVP and group chief risk officer at RenaissanceRe and co-chair of the Insurance Development Forum Risk Modelling Steering Group, added: “This is an outstanding example of continuing industry collaboration to drive the democratization of risk insight around the world. RenaissanceRe is incredibly proud of this initiative, and it is tangible evidence of our ESG goals of protecting communities by closing the protection gap and inducing positive societal change.”
The OED Standard for property and extension to cyber and casualty risks, is helping to drive further innovation in the risk modelling space. Its benefits include:
One consistent, community-owned market standard for catastrophe risk data.
-A significant reduction of resource strain in data processing and formatting.
-An improvement in high-quality data transfer between users of multiple models and systems.
-Better access to credible risk management data for underserved and disadvantaged communities.
An overall enhancement in the digitalization of the insurance industry.
Improved risk perspective through less reliance on any particular model developer.
Paul Nunn, head of Sustainable Insurance, SCOR, commented: “The success of this data standards initiative typifies the enormous drive and desire of our commercial and non-commercial partners to invoke meaningful and positive change through greatly improved ‘open’ and ‘easy’ exchange of critical risk information. No doubt this will greatly advance our common goal of helping to continuously advance societal resilience globally.”
The utilization of an industry-wide standard for property risk reinsurance models aims to assist with solving the existing data and model interoperability challenges in the re/insurance market.
Martin Bertogg, head of Cat Perils, Cyber and Geo at Swiss Re, said: “We are proud to be among the industry players helping to unlock risk model data. Globally shared data formats are an important step to overcome barriers for consistency, processing efficiency and a transparent cat risk dialogue. Our industry has an urgent need to take out non-value adding friction from its production chain. By supporting OED, we take an important step to facilitate more insurance risk transfer.”
Jörg Steffensen, general manager, Group Risk Management at Hannover Re, added: “The new OED Standard enables not only a close interoperability between different risk stakeholders but also supports a wide field of open source projects in academia. Therefore it serves perfectly Hannover Re’s principle “beyond risk sharing – we team up to create opportunities.” The new standard is a major step forward in creating more resilience to natural catastrophes around the world and closing the protection gap.”