Insurance and catastrophe
Insurance is where physical risk is priced; the systemic concern is the protection gap, the share of economic losses that no one has insured, and the withdrawal of cover from places where risk is rising.
- Institution
- The Global Centre for Risk and Innovation (GCRI)
- Service level
- R0: information and enquiries
The short answer.
Insurance and catastrophe as a field covers how risk is pooled and transferred through insurance and reinsurance, how catastrophe losses are modelled and where protection gaps remain. In the Nexus Consortium it is understood financially at GRA by Insurance Nexus as well as Reinsurance and Catastrophe; this gateway links those platforms and the methods they share.
The field, seen three ways.
Science and evidence
No platform yet in this field.
Governance and dialogue
No platform yet in this field.
Financial understanding
Insurance Nexus, Reinsurance and Catastrophe, Disaster Risk Finance, Actuarial and Quantitative Risk
Protection gaps and insurability.
When hazard rises faster than incomes and risk reduction, premiums climb, cover is withdrawn and losses shift to households and public budgets. Catastrophe models, built from hazard, exposure, vulnerability and financial modules, are the shared tool; their science inputs are where GCRI's work is relevant.
Supervisory and development references.
| Framework or body | What it governs or supplies |
|---|---|
| IAIS Insurance Core Principles | Supervision of insurers, including climate risk application papers |
| Insurance Development Forum | Public-private work on protection gaps and risk modelling |
| Global Earthquake Model and open catastrophe modelling | Open hazard and risk components |
Hazard science to balance sheet.
Hazard inputs come from Climate and Hazards and Disaster Resilience and Recovery; financial understanding sits on GRA's platforms listed below.
The methods behind the field.
- Actuarial mathematics
- Extreme value theory and tail risk
- Probability and statistics
- Climate and atmospheric science
- Artificial intelligence and machine learning
- Earth and geophysical science
- Uncertainty quantification and model validation
- Hydrology and water science
- Ocean and coastal science
- Structural and earthquake engineering
- Economics and development economics
- Decision analysis under uncertainty
- Forecasting and time-series analysis
- Financial and risk engineering
- High-performance, cloud and edge computing
Terms used on this page.
Each term as this page uses it. Where a standard-setting body defines the term, the wording follows that body.
| Term | Definition |
|---|---|
| Insurance risk | The risk that claims and related expenses differ from what was assumed when policies were priced and reserved, through frequency, severity, timing or accumulation. |
| Reinsurance | Insurance bought by insurers to transfer part of their risk, limiting large or accumulated losses and freeing capital. |
| Actuarial science | The discipline that applies mathematics and statistics to assess risk in insurance, pensions and finance. |
| Protection gap | The share of economic loss from an event or risk that is not covered by insurance and falls on households, firms or public budgets. |
Where this page's references lead.
The bodies and documents this page is read against. Status and editions change; each link goes to the issuing body.
Questions and answers.
Why does GCRI host field gateways?
Around GCRI.
Start with an enquiry.
The current service level is R0: information and enquiries. An enquiry receives a reference and names the next step; applications, payments, compute allocations and registrations open only when their team, terms and review capacity exist.