Allianz, Praedicat Partner on Improving Catastrophe Liability Risk Predictions

Allianz Global Corporate & Specialty SE (AGCS), the corporate insurance unit of Allianz SE, is working with Praedicat, the Los Angeles-based InsurTech analytics firm, to better predict key catastrophe liability risks.

The partnership aims to find new ways to better predict future liability catastrophe risks—such as asbestos—and gain insights on emerging risks and new business opportunities, AGCS said in a statement.

AGCS explained that Praedicat’s modeling engine uses machine learning technology “to scan large volumes of data from peer-reviewed science publications and profile the likelihood that products or substances will generate litigation risks over their lifecycle.”

The partnership will combine Praedicat’s “forward-looking predictive modeling approach with AGCS’ underwriting processes and liability risk portfolio analysis” to help AGCS liability underwriters better identify and assess future liability risks for industries or single companies, AGCS added.

Asbestos, which caused insured losses of $71 billion globally until 2011 (according to Swiss Re) is one high-profile example of such a manmade liability disaster, AGCS noted.

“Forward-looking models will transform insurance underwriting. Through this collaboration, we hope to change the core role of underwriters, freeing them up from the daily paper grind and empowering them to be data scientists,” said Hartmut Mai, chief underwriting officer and board member, AGCS.

“Emerging risks are challenging to quantify for an insurer. But now, AGCS underwriters will be able to identify emerging liability catastrophe risks with increased confidence based on in-depth data,” he continued.

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“With forward-looking models, machine learning and algorithmic search, the insurance sector is in the midst of transformation,” says Robert Reville, chief executive officer at Praedicat. “These new technologies are driving competitive advantage. Praedicat is very proud to be working closely with AGCS in its commitment to the new technologies to drive the future of underwriting of corporate risks.”

“AGCS will help clients understand potential emerging liability risks and their impact on their company while providing innovative solutions”, said Michael Hohmann, global head of Liability, AGCS. “We will use the Praedicat data and tools to help our clients achieve better product stewardship and to tailor their insurance program to their specific risk profiles.”

Source: Allianz Global Corporate & Specialty (AGCS)