Cat modelers take separate paths in search of common standards.Insurers, reinsurers and other industry executives should use their collective influence to pressure risk data modeling firms to move toward open standards Specifications for hardware and software that are developed by a standards organization or a consortium involved in supporting a standard. Available to the public for developing compliant products, open standards imply "open systems;" that an existing component in a system can be replaced , according to according to
1. As stated or indicated by; on the authority of: according to historians.
2. In keeping with: according to instructions.
3. Rick Clinton, the president of Oakland, Calif.-based modeling firm Eqecat Inc.
Noting that he and his fellow modeling firms long have been forcing users to adapt to each of their own proprietary data formats, Clinton said a move toward open standards would allow insurers to assess and manage catastrophe loss exposure more effectively.
"It is not a very efficient process for the industry, as it can discourage the use of multiple models," Clinton said. "For some companies, their true exposure might be revealed by only using one of the models, which might not be the one they've chosen, or it could be that it would only be revealed by using several models."
While most in the industry recognize the potential value of open data standards, Clinton said among the factors that have led modelers to avoid the move have been fears that they might lose a competitive advantage or that they didn't want to bear the cost involved with changing their systems.
According to Clinton, the answer is to support the efforts of the Association for Cooperative Operations Research operations research
Application of scientific methods to management and administration of military, government, commercial, and industrial systems. It began during World War II in Britain when teams of scientists worked with the Royal Air Force to improve radar detection of and Development once it finalizes an open-source property insurance data standard. He added that Eqecat was the first modeling company to accommodate data in the Cresta Plus market standard format for electronic reporting of insurers' exposure data.
"We're committed to the ACORD ACORD Association for Cooperative Operations, Research and Development
ACORD Agency for Cooperation and Research in Development
ACORD Association de Coopération et de Recherche pour le Développement (French) standards," Clinton said. "I think what that has to mean is that we work toward a multiple platform, flexible import standard with a simple mapping routine where you can very easily map over without reconfiguring your data. The difficulty is getting there."
Uday Virkud, a senior vice president with Insurance Services Office Insurance Services Office, Inc. (ISO) is a provider of data, underwriting, risk management and legal/regulatory services to property-casualty insurers and other clients. Headquartered in Jersey City, New Jersey, the organization serves clients with offices throughout the United Inc.'s modeling subsidiary, AIR Worldwide, said his company already has provided the groundwork for just such a product with the company's Universal Cession The act of relinquishing one's right.
A surrender, relinquishment, or assignment of territory by one state or government to another.
The territory of a foreign government gained by the transfer of sovereignty.
CESSION, contracts. Electronic Data Exchange, or Unicede standard, which distributes exposure data between companies ceding cede
tr.v. ced·ed, ced·ing, cedes
1. To surrender possession of, especially by treaty. See Synonyms at relinquish.
2. and assuming natural-hazard risk.
Developed after the strike of Hurricane Andrew This article is about the 1992 hurricane; there was also a Tropical Storm Andrew during the 1986 Atlantic hurricane season.
Hurricane Andrew is the second-most-destructive hurricane in U.S. history, and the last of three Category 5 hurricanes that made U.S. in 1992, Unicede quickly was made available to AIR's competitors, and Unicede files are used routinely by a variety of non-AIR software applications, Virkud said. He also said he hasn't seen thus far a firm commitment from other firms to similar efforts.
"We've always supported open standards, and we too have worked with ACORD in developing them," Virkud said. "The drive for a standard has to happen naturally, it can't be imposed from the top down."
Paul VanderMarck, executive vice president of products for Newark, Calif.-based Risk Management Solutions, concurred with Virkud, adding that he thinks Eqecat might be "addressing a problem that doesn't really exist."
"The data provided from insurers to reinsurers in standardized standardized
pertaining to data that have been submitted to standardization procedures.
standardized morbidity rate
see morbidity rate.
standardized mortality rate
see mortality rate. electronic formats works incredibly well today," VanderMarck said. "The issue is much more what happens with data transfers between corporates and insurers, which is just an incredibly inefficient process."
The issue is not so much developing a common standard as determining whose standard will prevail, he said.