Emerging risks drive XL Catlin partnership with Praedicat

XL Catlin has joined forces with insuretech company Praedicat to help clients address changing liability insurance needs and to try to identify future latent risks.

XL Catlin said that it had highlighted Praedicat’s emerging risk models and software for casualty insurance and that it has signed a multi-year engagement deal with Praedicat. The agreement will include access to Praedicat's latency risk model and mass litigation scenarios, its software on emerging risks called CoMeta, and Oortfolio, its portfolio modeling software.

Praedicat's models and software analyse risks that emerge over time, as these latent risks can build up in an insurer's portfolio. One of the most prominent historical examples is asbestos, which cost the industry almost $100 billion and continues to generate losses today.

The company said that the insurance industry has always been concerned about what might be the next asbestos, looking at areas such as nanotechnology, hydraulic fracturing, plastics and pesticides. Praedicat has developed an AI-based technology for summarising scientific literatures around health and environmental risks for commercial products and business practices. The technology is used to identify and track the science for hundreds of emerging risks, simulate mass litigation from those emerging risks, and profile the companies exposed.

According to David Brooks, XL Catlin’s global head of ERM, Man-Made Perils, "XL Catlin has developed a broad range of risk scenarios for property and casualty. The hardest area to build them and keep them realistic is in liability where new technologies are emerging, and the world is always changing. We were impressed with Praedicat's science-based approach to the problem."

"XL Catlin is committed to Insuretech innovation, to market leadership in data and analytics for underwriting, and to state-of-the-art enterprise risk management," said Nancy Bewlay, global casualty chief underwriting officer. "Working with Praedicat allows us to advance all three goals.

"Praedicat's solution is not a risk avoidance approach, it is a risk understanding approach. This was critically important to us as we are here to support our clients' needs for coverage, which means risk engagement not avoidance."