Risk Management Solutions (RMS) announced that the Florida Commission on Hurricane Loss Projection Methodology (FCHLPM) unanimously re-certified the RMS Hurricane model for use in establishing residential insurance rates in the state of Florida.
RMS is a provider of products and services for the management of catastrophe risks, and its U.S. Hurricane model is used by primary insurers, reinsurers, intermediaries, and other financial institutions to develop strategies for pricing, portfolio management, and risk transfer. This marks the seventh consecutive year that the RMS model has been certified by the FCHLPM.
To be certified by the Commission, a company must provide extensive documentation supporting the hurricane model’s accuracy and be audited by an independent panel of experts. The RMS model passed all 34 standards set forth by the FCHLPM in its most recent Report of Activities, covering the aspects of vulnerability, validation, computing, statistics, and the actuarial use of modeled loss costs. These standards were expanded from previous years to include a more in-depth evaluation of all of the model’s technical components.
“Providing a robust and reliable tool for use in residential rate filings is an integral part of the solution set we offer our clients,” said Kyle Beatty, manager of technical marketing at RMS. “The continued certification of RMS’ hurricane model in light of the increasing demands of the Commission underscores our commitment to providing high-quality products that are firmly rooted in the latest advancements in science, engineering, and technology.”
The RMS* U.S. Hurricane Model was first released in 1993, and has undergone two major upgrades, in 1997 and again in February 2003.
Since the February 2003 release in RiskLink* 4.3 and RiskBrowser* 3.2, the model’s mitigation measures have been further expanded to include a greater number of options addressing Florida Statue 627.0629, which requires residential insurers to provide credits for certain construction characteristics that improve structural performance.
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