RMS Withdraws Five-Year Hurricane Model from Florida

May 18, 2007

  • May 19, 2007 at 6:28 am
    Jane Logan says:
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    Insurance is a business requiring long term planning, CEO\’s compensation packages are based on short term, not long term results. This is a huge conflict of interest in any industry but is of special concern for the insurance industry.

    RMS is majority-owned by DMG Information, a division of the U.K.-based Daily Mail and General Trust, plc media enterprise.
    – quoted from RMS website

    DMGT is owned by another entity based in Bermuda-land of captive insureres and reinsurance carriers. My guess is that a reinsurance carrier owns DMGT which owns RMS. So in fact it is the reinsurance community controlling the hurricane models.

    In the interest of transparency, RMS/DMGT should disclose their ultimate parent company. If they won\’t disclose who\’s calling the shots voluntarily, legal action should ensue to require the disclosure.

    I hope my theory that RMS is owned by a reinsurer is completely wrong. It would be nice if RMS responded to this question but there\’s about as much chance of that happening as a Cat 5 hurricane hitting Cape Cod this season…

    – Jane Logan, CPCU
    Cape Cod, MA

  • May 20, 2007 at 10:03 am
    Joe Petrelli says:
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    The FIU model, developed with public funding at a state university, produced the highest level of losses and therefore was not yet certified. The reinsurance community wants to get it right. The FIU model wants to get it right.

    More communication is the answer, not less.

  • May 20, 2007 at 12:08 pm
    Joe Petrelli, Demotech, Inc. says:
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    Innuendo, intimidation and insults will not resolve the property insurance crisis in Florida. Polarization of the constituencies that should be working together is counterproductive.

  • May 20, 2007 at 1:06 am
    Jane Logan says:
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    Check out RMS\’s Sister Company Euromoney Institutional Investor website and check out the name of the publications they offer. My personal favorite is LOOT which ofcourse has more than one meaning-all applicable to what RMS\’s inflated hurricane models are DOING TO consumers and PROVIDING TO insurance carriers. Nice play on words RMS…

    I think we\’ve had more than enough of working together, thank you. We\’ve seen what collusion between insurance carriers and insurance carriers and hurricane modelers has done for consumers-it\’s about time someone broke up this little price fixing triology of primary carriers, hurricane modelers and reinsurance carriers. Again, someone please make me wrong and prove RMS is not owned by the reinsurance community.

    -Jane Logan, CPCU Cape Cod, MA

  • May 20, 2007 at 4:41 am
    Jane Logan says:
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    This is a direct quote from RMS website:

    Newark, Calif. — May 14, 2007 — Risk Management Solutions (RMS), the world’s leading provider of products and services for catastrophe risk management, is pleased to announced that Robert Bentley has been appointed as its first Chief Operating Officer (COO). Mr. Bentley, who was previously Global COO at Guy Carpenter & Company, LLC., a re/insurance brokerage firm, will be responsible for all operational aspects of RMS and will report directly to Hemant Shah, President & CEO of RMS.

    Rob is uniquely qualified for this role,” said Mr. Shah. He has the experience of being the COO of a dynamic, global organization, and has a deep understanding of RMS people and products, and our position in the marketplace, having had a long-standing relationship with our company.

    Mr. Bentley’s appointment reinforces RMS’ commitment to continued growth and innovation by continuing to invest in operational capability. “Rob brings a great execution mindset to the role of COO that will enable us to achieve our goal of broadening our product and service offerings, and thriving in a dynamic market,” added Mr. Shah.

    Mr. Bentley began his career at Guy Carpenter in 1987 as a property broker. He moved to Aon Re in 1993 and returned to Guy Carpenter in 1996 as a founding member of the company’s Property Specialty and as a registered representative of Marsh & McLennan Securities Corporation. In January 2000, Mr. Bentley moved from the Property Specialty to assume leadership of Guy Carpenter’s Instrat operations. He later assumed the role of Western Region Manager and the position of Global COO in 2005.

    “It’s a great honor to join RMS,” said Mr. Bentley. “The firm has a special culture and a team that I have admired for years. RMS also has strong client relationships across the market and has numerous avenues to expand globally. I look forward to being part of a company that works hard to listen to clients, innovate, and deliver.”

    Mr. Bentley, who joins RMS on May 14, will be principally based in the company’s New Jersey office.

    So it\’s official – as of May 14, 2007 the RMS is being run by reinsurance insiders.

    Now tell me I\’m wrong that the reinsurance industry is controlling the hurricane modeling.

    – Jane Logan, CPCU
    Cape Cod, MA

  • May 21, 2007 at 10:56 am
    JC says:
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    Tax-Funded Storm Model Paints A Grimmer Picture

    By KEVIN BEGOS The Tampa Tribune

    http://www.tbo.com/news/nationworld/MGBDIZS9H1F.html

    It would seem that the State of Florida and advocacy groups simply will not accept any models that show an increase in hurricane activities that will increase premiums. I wonder what will eventually get accepted.

  • May 21, 2007 at 2:11 am
    Jane Logan says:
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    C\’mon JC you don\’t find it at least a little troubling that a former reinsurance insider is now officially running RMS?! – Jane Logan, CPCU

  • May 22, 2007 at 7:50 am
    Michael says:
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    Jane my dear – The reason the ins. costs in Florida have gone up is really simple and a 5th grader can figure it out. HURRICANES. Not that a former reinsurance broker is now working at RMS.
    I for one want everyone to use the public model, it must be right the govt said so until they didn\’t like the answer or the answer of anyother model. Shame on using this crisis for votes.

  • May 23, 2007 at 12:28 pm
    Actuary says:
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    The Florida Public Model submitted to the Hurricane Commission this year produced expected losses significantly higher than any of the private models in most counties, and that includesRMS\’s near-term frequency model.

  • May 23, 2007 at 12:44 pm
    Actuary says:
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    Please disregard my prior post.



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