EcoSphere - An Environmental Risk Management Platform for the Insurance Sector

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Climate change is impacting our planet at an unprecedented rate. The physical risks, notably extreme-weather events such as floods and wildfires, and longer-term impacts such as sea-level rise, must be better assessed to ensure we are prepared for the impacts of the changing world. Climate and environmental changes demand more sophisticated risk models and risk transfer to address the increased severity and frequency of catastrophic events. The risks insurers routinely cover are becoming more severe and unpredictable. Since the 1980s, average annual losses from natural disasters have more than sextupled in real terms. When it comes to climate change, insurers need to work on providing accessible and affordable products that respond to disasters but also help the communities insurers serve to prepare for the ongoing impacts of climate change.The proposed project aims to deliver a cloud-based platform (CyStellar EcoSphere) to provide real-time climate change and environmental impact insights into the risk selection and underwriting, reserving and ratemaking, portfolio optimization and claim assessment processes specific to the insurance sector. The proposed platform helps the insurance sector to undertake a comprehensive and transparent physical risk and environmental impact assessment, with the goal of making more sustainable insurance and financing decisions. The overall business benefits of the project's proposed approach and solution can be considered across 3 separate broad areas: (1) will ensure insurers allocate capital in a way that considers climate change risks (2) minimizes environmental impacts of the insured assets and helps mitigate climate change risks (3) aligns with sector-wide net-zero goals.The proposed EcoSphere platform integrates, manages, and secures data from ground sensors, air surveillance platforms, and satellite data at a massive scale. In addition, the platform integrates data from weather forecasts, hazard and risk data, as well as other relevant societal, political, and economic information. The cumulated information feed will be processed and integrated into the (re)insurers workflows and will offer valuable risk and climate change impact insights on almost any place on the globe and will be directly linked to the pricing of insurance policies.