Lloyd’s Lab Demo Day: srccQuantum Release

Last week as part of the Lloyd's Lab Demo Day we launched the first release of srccQuantum – our SRCC modeling platform specifically designed with and built for the insurance market.

Insurers have seen a staggering 3,000% increase in claims relating to SRCC over the past two decades and recent global events - including the riots in the UK and New Caledonia - have resulted in billions of dollars of insurance losses and caused some real anxiety in the market.

The issue is further complicated by the fact that SRCC exposure is currently embedded in all-risk property policies making it extremely challenging to price and aggregate.

SRCC is an incredibly challenging peril to model because:

1.       Historical SRCC data is scant and not representative of current or future events.
2.       SRCC events are driven by a complex interplay of societal, economic, and political factors.
3.       The evolution of the event and resulting property damage is incredibly difficult to predict.

Consequently, there is an urgent requirement for better data, and the right tools to address the challenge of this complex and growing global peril and this is the problem that we are seeking to address.

There is an appetite, requirement, and opportunity for better SRCC models right across insurance, from the insureds closest to the risk, through to the capital markets.

During our time in Lloyd’s Lab, we heard how better SRCC models will help:

1.       Brokers looking to understand client SRCC exposure.
2.       Underwriters with SRCC exposure embedded in their books.
3.       Reinsurance brokers and insurers seeking better structuring and to reduce SRCC accumulations, and
4.       The Capital Markets where innovation is needed by groups like IFTRIP, especially as they look to issue more Cat Bonds.

srccQuantum calculates the total economic losses from SRCC events and helps assess potential insurance market impacts.

srccQuantum works in three steps:

1.       EXPOSURE - ingest property portfolios (in any format) or generate property datasets for any point on the planet
2.       RISK - calculate SRCC event risk at a location, property, or portfolio scale
3.       MODEL - we enable the user to model SRCC events and quantify losses

As part of our product launch of srccQuantum, we published a White Paper that included a validation study for the Minneapolis riots in 2020. The White Paper is freely available on our socials.

We are conducting commercial discussions with the industry partners and early adopters, and we have three distribution channels:

1.       SaaS sales and licensing
2.       Integration of the data/model into customer platforms
3.       Consultancy and advisory project work with long term partners

The upcoming release of a Lloyd's SRCC Extreme Disaster Scenario in 2025 will inevitably bring more attention to the peril and further enhance srccQuantum’s value proposition.