JERSEY CITY, N.J., Sept. 04, 2019 (GLOBE NEWSWIRE) -- PCS®, a Verisk (Nasdaq:VRSK) business, has collaborated with Asociación Mexicana de Instituciones de Seguros (AMIS) to deliver PCS Mexico, the latest loss aggregation solution for property-catastrophe events. PCS Mexico will provide full coverage for natural and man-made events across Mexico with total industry insured loss estimates of at least MX$300 million (approximately US$15 million). Mexico is the fourth country to be covered by PCS, following the United States, Canada, and Turkey.
Mexico’s catastrophe profile has many similarities to the United States and Canada, with exposure to tropical storms, earthquake, and hail, among other perils. And like its North American neighbors, Mexico has experienced catastrophe activity that has been both frequent and severe. With data dating back to 2010, PCS Mexico—developed with the close support of AMIS—shows there have been three recent catastrophe events with industrywide insured loss estimates of at least MX$9.6 billion (approximately US$500 million). In fact, two of them have occurred within the past 24 months.
PCS Mexico will use the same loss estimation methodology that PCS has had in place in the United States for nearly 70 years. The only differences are the thresholds for event designation (MX$300 million) and for initiating the resurvey process (MX$1 billion, approximately US$50 million). The PCS resurvey process involves revisiting industry loss estimates and publishing updates every 60 days until the operations team decides that industry loss estimates are stable—at which point PCS closes the catastrophe event.
PCS and AMIS expect the launch of PCS Mexico to have an impact on the global reinsurance and insurance-linked securities market fairly quickly. Since 2006, eight catastrophe bonds have included Mexico, and feedback from clients around the world suggests that pent-up risk-transfer demand has been constrained by the lack of a reliable, independent loss aggregation solution.
Tom Johansmeyer, head of PCS, notes that the industry has wanted independent catastrophe loss aggregation for Mexico for quite some time. “Mexico has been one of the top enhancement requests we’ve heard from clients since I joined PCS,” he says, “and interest has only grown over that time.” Johansmeyer adds, “Mexico is an important market, and there’s broad support throughout the global insurance and reinsurance community. Unbiased tools are crucial to participating in a robust risk-transfer market, and we’re excited to be able to help our clients operate more effectively in managing risk and capital exposed to Mexico.”
Johansmeyer continued, “The launch of PCS Mexico took significant time and effort from everyone involved, including a wide range of industry stakeholders. In particular, we’d like to express our appreciation for the time and commitment from the AMIS team. Without their considerable contributions and collaboration, PCS Mexico would never have come to fruition. Throughout the development of PCS Mexico, we saw firsthand the strength and depth of AMIS’s commitment, not just to the Mexican insurance industry but to the global community that allocates reinsurance capacity to the region.”
Ted Gregory, director of operations, adds that “the launch of PCS Mexico further solidifies PCS’s important role within the global insurance community. With Mexico susceptible to a multitude of significant perils, such as earthquakes, volcanic activity, and hurricanes on both coasts, PCS looks forward to serving our insurance community in Mexico and abroad with our collective efforts to provide exceptional service.”
AMIS leaders are enthusiastic about the launch. Manuel Escobedo, AMIS president, states, “For many years, the insurance industry in Mexico has produced catastrophe loss estimates to inform our insureds, shareholders, and financial authorities. With this ISO/PCS agreement, our estimates will be timelier and more consistent.” Recaredo Arias, AMIS CEO, adds, “The ISO/PCS platform will allow Mexican insurance companies to access robust information to calibrate their catastrophe risk models. This will benefit both insurers and insureds, while paving the way for product innovation.”
Dario Luna, managing partner at Akua Capital, was among the industry leaders instrumental in the development of the loss index. He states, “We’re pleased to have partnered with PCS to bring Mexico into international standards for catastrophe loss information. PCS Mexico presents a range of innovation opportunities and will surely trigger the interest of other Latin American countries.”
PCS Mexico joins a broad set of PCS loss aggregation solutions. In addition to property-catastrophe loss aggregation, PCS has global specialty lines solutions in place for nonelemental marine and energy, cyber, and terror. PCS expects the PCS Mexico loss aggregation tool to be available for login by the end of the first quarter.
About AMIS
The Asociación Mexicana de Instituciones de Seguros (AMIS) affiliates more than 95% of the insurance companies in Mexico. Its main purpose is to promote industry development, represent industry interests, and provide technical support and services to its affiliated companies. Created in 1964, AMIS is headquartered in Mexico City (www.amis.com.mx).
About Akua Capital
Akua Capital is a private equity and advisory firm focused in the insurance and reinsurance sectors of Latin America. Akua is based in Mexico City (www.akuacapital.com.mx).
About Verisk
Verisk (Nasdaq:VRSK) is a leading data analytics provider serving customers in insurance, energy and specialized markets, and financial services. Using advanced technologies to collect and analyze billions of records, Verisk draws on unique data assets and deep domain expertise to provide first-to-market innovations that are integrated into customer workflows. Verisk offers predictive analytics and decision support solutions to customers in rating, underwriting, claims, catastrophe and weather risk, global risk analytics, natural resources intelligence, economic forecasting, and many other fields. Around the world, Verisk helps customers protect people, property, and financial assets.
Headquartered in Jersey City, N.J., Verisk operates in 30 countries and is a member of Standard & Poor’s S&P 500® Index. In 2018, Forbes magazine named Verisk to its World’s Best Employers list. For more information, please visit www.verisk.com.