Bitesize InsurTech: EigenRisk
October 10, 2020 George Hanks
EigenRisk is a cloud-based catastrophe risk analytics platform.
Founded in 2014, EigenRisk aims to be a ‘one stop shop’ for managing and analysing catastrophe risk. Its founders, Deepak Badoni and Eduardo Hernandez (both ex-Marsh) identified that analytics are still broadly under-powered in this area. Their assertion is that this is not because of a lack of data, but because the data is buried in clunky spreadsheets and ‘black box’ models. EigenRisk helps to make this data accessible and easily digestible for decision-making.
There are four parts to the platform:
- Data Management: A data warehouse into which clients can upload their data on a continuous basis (via API integration) and store it in a consistent format.
- Analytics: A catastrophe-focused analytics solution with geo-visualisation, reporting and analytics functionality. Notable features include the ability to run ‘what if’ scenarios on exposures (e.g. what if there was an earthquake).
- Alerts: Real-time event monitoring, with global coverage of major perils. Automated notifications provide the estimated impact on the clients’ portfolio, within minutes of an event.
- APIs: A feature which allows customers to embed Eigen’s functionality (e.g. analytics, reports) into their own applications.
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The platform is targeted at various parties across the value chain, from Risk Managers in corporates who want to understand the detail of their risk exposure, to (re)insurers who want to bolster their in-house catastrophe risk analytics capabilities.
EigenRisk has had good traction to date. Swiss Re Corporate Solutions has embedded the product into its PULSE client portal. Three of the top ten global brokers are also customers.
The Oxbow Partners view
In a world of global warming and more frequent extreme weather events, the need for technology that helps with understanding and managing the associated risks seems clear. EigenRisk is not the only company to have noticed this – for example, many of the large brokers offer Catastrophe Analytics services and a number of other technology companies operate in this space (e.g. Sequel Impact).
However, understanding and managing risks are not sufficient for insurers – they must also have an operating model which allows them to respond in the case of a catastrophe event. Such a model requires specific capabilities, such as agreed response ‘triggers’ and a clearly defined response process. Whilst these capabilities are commonplace in the operating models of insurers in ‘traditional’ catastrophe zones (e.g. insurers in Florida), they are less likely to feature outside of these zones.