New tool helps risk managers prepare for blackouts and other perils

Publish Date: 
June 2, 2013
Article Source: 
Business Insurance

Greg Barats, President and CEO of HSB, said partnering with Verisk research arm AER "was the best way to commercialize the product. 'AER brings in a significant amount of technical modeling capability, including a state-of-the-art weather simulation model...This model would be able to run a wide range of scenarios from weather to human- and equipment-caused
failures. This is a unique opportunity to bring in a probabilistic tool to estimate losses.”

"AER President and CEO Ron Isaacs agreed that the alliance "will give users a better sense of how the intersection of weather events and an aging power grid threaten the power infrastructure on which businesses depend. 'HSB has very deep knowledge associated with electrical infrastructure equipment. They bring to the table a profound understanding of the parametric issues associated with power generation, distribution and transportation equipment. AER has a complementary, profound understanding of the phenomenology associated with the environment, in particular weather.'

"For example, using AER's historical data has allowed creation of simulations and scenarios to show risk managers how a given event would affect the power infrastructure on which they rely.