Moody’s RMS is partnering with Augment Risk to develop parametric risk transfer tools.

The collaboration is designed to benefit large corporates with captives, Lloyd’s syndicates and ILS funds, and will focus on a variety of perils including windstorms, earthquakes, wildfires and severe convective storms.

Ben Brookes, managing director, Moody’s RMS, said: “We believe parametric risk transfer products will play an increasingly important role in managing risk. Parametric risk transfer offers the combined benefits of high transparency and complete risk disclosure, plus the prospect of rapid loss settlement. We look forward to continuing to open up significant market growth by increasing the use of sophisticated risk models and basis risk analytics as enablers.”

Kurt Cripps, global head of parametric at Augment Risk, added: “Working with Moody’s RMS will allow our clients access to some of the most advanced risk analytics capabilities in the world and will develop model-ling specifically for parametric reinsurance protections. For index-based solutions to grow as an asset class the modelling must underpin the view of risk from an empirical and stochastic standpoint.”

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