AIR Worldwide Does Over $10bn of Insurance-Linked Securities Risk Modelling

AIR Worldwide Corp. (AIR) said it has provided risk modelling and analytical services for more than $10 billion in insurance-linked securities (ILS) since 1996 and over 56% of total issuance since 2007.
 
“Risk modelling is a key element in the risk assessment of a catastrophe bond for issuers, rating agencies, and investors alike,” said Augustin Gas, head of ILS and alternative retrocession at French reinsurer SCOR. “AIR’s superior methodology and modelling expertise is crucial in providing the underlying analysis detailing the risk to the proposed bond. AIR also provides exceptional service throughout the process and delivers the analysis results within the scheduled timeframe.”
 
In 2008, AIR provided risk modelling and analytical services for 70% of the catastrophe bond capital issued. Thus far in 2009, AIR has been the modelling and calculation agent for all catastrophe bonds issued to date, including Atlas V, East Lane Re III Ltd. Series 2009-1, and Mystic Re II Ltd. Series 2009-1, totaling $575 million in new issuances.
 
“Atlas V was the first catastrophe bond to come to market in six months and is the first in a new generation of cat bonds,” said Erik Manning, a director at Deutsche Bank. Manning added that AIR was also involved in 2008’s pioneering Blue Coast Ltd. bond that used the recently developed Long-Term Aggregate Zonal Reinsurance (LAZR) hybrid trigger that combines state-level PCS industry loss estimates and AIR’s model losses by county.”