Moody’s RMS North Atlantic Hurricane Models Version 23 Certified by Florida Commission on Hurricane Loss Projection Methodology

NEWARK, CA – June 6, 2023 – Moody’s RMS, the leading global catastrophe risk modeling and solutions company, announced that version 23 of the Moody’s RMS North Atlantic Hurricane Models was approved by the Florida Commission on Hurricane Loss Projection Methodology (FCHLPM) on June 1, 2023, for use in residential rate filings with the Florida Office of Insurance Regulation.

The certification applies to version 23 hurricane models available on RiskLink® and the Risk Modeler™ application on the Moody’s RMS Intelligent Risk Platform™. Informed by new industry loss and claims data, research, and insights from recent seasons, the updated version 23 hurricane models allow Moody’s RMS to continue to provide the (re)insurance market with the most comprehensive view of the hurricane risk landscape.

The models include new updated data and learnings from major events over the last two years:

• Nearly USD $80 billion in new industry loss data, including Hurricane Ida (2021) and Hurricane Ian (2022)
• More than USD $6.5 billion in new detailed claims data, including more than USD $3 billion in new residential claims data outside of Florida, more than USD $2 billion in new U.S. commercial claims, and more than USD $1 billion in data from Puerto Rico
• Insights into structure and roof performance from field reconnaissance after recent events, including hurricanes Irma (2017), Michael (2018), and Ian (2022)

Matthew Nielsen, senior director, regulatory affairs, Moody’s RMS, said: “We are proud to be the first risk modeler to gain FCHLPM approval under the newest standards. Obtaining FCHLPM certification underscores the continued quality and reliability of our North Atlantic Hurricane Models, based on industry-leading science, data, methods, engineering, and software.”

The new version 23 will include updates to existing models for core perils and for climate change views and includes enhancements to geocoding, model analysis flexibility, data framework, security, and more.

As Moody’s RMS has done in previous years, version 23 models and associated expanded functionalities will be released simultaneously for both on-premises and hosted clients using RiskLink® and RiskBrowser, and applicable updates will be applied to all Moody’s RMS Intelligent Risk Platform™ applications, including Risk Modeler™, ExposureIQ™, TreatyIQ™, UnderwriteIQ™, and the Location Intelligence API. With this new release, the Moody’s RMS Intelligent Risk Platform™ will now simultaneously support five model versions: 18, 18.1, 21, 22, and 23.

Some key updates in version 23 include:

• Moody's RMS North Atlantic Hurricane Models (including Climate Change Model)
• Geocoding updates in 37 countries including new 'Points of Interest' resolution
• U.S. and Caribbean Industry Exposure Databases and Industry Loss Curves
• Global Post-Loss Amplification (PLA) Scale Factor for Detailed Loss Model (DLM) analyses
• Moody's RMS U.S. Inland Flood HD Model v1.2 update
• Improvements in security, password rotations, and environment pre-requisites

Robust View of Tropical Cyclone Risk: North Atlantic Hurricane Models

“The version 23 release will ensure that Moody’s RMS continues to provide the market with a suite of North Atlantic hurricane modeling tools, analytics, and data solutions that reflect the most mature, robust modeling view of the dynamic and evolving hurricane risk landscape,” said Jeff Waters, staff product manager, Moody’s RMS North Atlantic Hurricane Models. “These model updates are informed by a combination of new hurricane activity and loss data since version 21, analysis of billions of dollars in new detailed claims data, new building code information, and new Moody’s RMS and external research.”

The release includes the following updates to the North Atlantic Hurricane Models:

• Revised long-term event rates and medium-term rates across the entire North Atlantic Basin
• Hazard updates, including a newer vintage of underlying land use-land cover data in Florida
• New and updated historical event reconstructions
• Significant vulnerability enhancements to residential and non-residential lines throughout the North Atlantic Basin – notably the elimination of the alternative vulnerability for Florida residential lines that were present in version 21
• Geocoding revisions
• Updates to specialty lines, including Industrial Facilities Model
• Significant enhancements to the building inventory database
• Updated post-event loss amplification (PLA) factors

Additionally, Moody’s RMS is introducing new software functionality allowing users to better reflect dynamic market conditions or non-modeled sources of loss directly within the model framework.

Version 23 also adds functionality that is exclusive to the North Atlantic Hurricane Models, which allows users to reflect non-modeled sources of loss by coverage type. Such factors can have a significant impact on industry and client losses, from assignment of benefits, construction cost inflation, contingent business interruption because of widespread power outages or infrastructure damage, litigation, excessive tree loss/damage, or coverage leakage from inland flooding. The impact of each factor can vary greatly by coverage type.

The FCHLPM certification of version 23 of the RMS North Atlantic Hurricane Models will be valid until November 1, 2025. Version 23 will be generally available on June 14, 2023, simultaneously on both RiskLink® and Risk Modeler™.

Learn more about the RMS North Atlantic Hurricane Models here.