Nanyang Technological University (NTU Singapore) is spearheading an alliance of leading multinational and regional companies in the insurance industry to enable more countries in Asia to better cope with the economic and financial fallout from natural disasters.
The Natural Catastrophe Data and Analytics Exchange (NatCatDAX) Alliance, launched at the 7th International Symposium on Catastrophe Risk Management organised by NTU, will be an industry-led catastrophe data and analytics platform for Asia. It will generate a rigorous database by tapping into national and industry data. Such high quality data, market analytics and product innovations are currently lacking in the region.
Helmed by NTU’s Institute of Catastrophe Risk Management, the Alliance is a partnership with Aon-Benfield, Mitsui Sumitomo Insurance Group, RenaissanceRe, Risk Management Solutions and PERILS AG, with support by the Monetary Authority of Singapore (MAS).
Natural disasters disproportionately affect Asia in terms of economic losses and casualties. This could be attributed to low insurance penetration, low catastrophe risk awareness, and a lack of effective risk transfer mechanisms.
Data necessary for catastrophe risk quantification in Asia and Southeast Asia is also generally poor in terms of availability, accessibility and quality. With such a lack of data standards and updated catastrophe models, governments may have to bear the bulk of catastrophe costs.
The Alliance will work towards plugging such gaps by addressing shortfalls in data required for risk management and quantification in Asia, including Southeast Asia.
Consortium to execute NatCatDAX Alliance’s vision
A Singapore-based consortium comprising NTU’s Institute of Catastrophe Risk Management, the Agency for Science, Technology and Research’s Institute of Infocomm Research (I2R) and PERILS AG will execute the Alliance’s vision.
Led by Professor Pan Tso-Chien, Executive Director of Institute of Catastrophe Risk Management at NTU, the Consortium aims to produce quality-assured economic and industry databases covering exposure and loss for Bangkok, Jakarta, Manila and Taipei, including earthquakes and wind storms such as typhoons, and floods.
NatCatDAX Alliance is a significant step towards strengthening Asia’s ability to mitigate risks. The MAS Deputy Managing Director Jacqueline Loh said last November that MAS supported the establishment of the Alliance as a partnership between the public and private sectors to develop databases necessary for catastrophe risk quantification for expanding the insurability of catastrophe risks.
NTU President Professor Bertil Andersson said, “As the region grows, so do the challenges and risks. Finding solutions to help mitigate against any fallout would be difficult without a comprehensive and accessible database.
“With NTU’s strengths in engineering and earth sciences, we are very keen to work with industry partners on research and develop applications to benefit society and to better cope with natural disasters.
“NTU’s Institute of Catastrophe Risk Management will lead efforts to combine remotely sensed exposure data with national and industry data sources to develop new knowledge that have a real impact in mitigating the devastating impact of natural catastrophes.”
Mr Bernard Wee, Executive Director (Financial Markets Development & Payment and Technology Solutions) at MAS said, “Robust catastrophe risk quantification in the region is essential to closing the rising protection gap. The NatCatDAX aims to overcome data limitations to strengthen Asia’s disaster risk resilience. MAS is proud to support the NatCatDAX.”
Mr George Attard, head of analytics (Asia-Pacific) at Aon-Benfield said, “By improving data standards and the availability of data through the NatCatDAX Alliance, we will enhance traditional re-insurance support for Asia Pacific risk, and expand the market to alternative capital providers.”
Mr Michael Gourlay, CEO of Mitsui Sumitomo Insurance Group, Singapore (Pte) Ltdcommented, “This aligns with our corporate mission as a leading insurer in our region to contribute to the development of a vibrant society and help secure a sustainable future for the world, by bringing security and safety through our global insurance and financial services business.”
Mr Jonathan Paradine, Chief Executive, Renaissance Reinsurance Ltd (Singapore Branch)said, “Fostering a shared, scientifically sound understanding of catastrophic risk in Asia will help to better protect people from the increasing risk of natural disasters, while expanding the penetration of insurance coverage will improve financial resiliency for our communities. This ground-breaking initiative will further enhance Singapore’s position as a strong, innovative financial centre and RenaissanceRe is honoured to be a founding sponsor.”
Risk Management Solutions Co-founder and CEO Hemant Shah added, “This is crucial to the development of new insurance markets in South-east Asia. The NatCatDAX Alliance will make an important contribution, in which RMS is proud to be part of and support the initiative.”
PERILS AG Head of Products Eduard Held commented, “PERILS is delighted to support the implementation of NatCatDAX as it has always been our goal to increase the availability of catastrophe insurance data for a better understanding and higher tradability of the catastrophe risk.”