In this article from Middle East Insurance Review, Guy Carpenter’s Lukas Müller, Chairman, Middle East and Africa, and Marcus Buechel, Catastrophe Flood Model Developer, discuss how the combination of natural and human factors introduces high levels of uncertainty into risk management strategies.
Saudi Arabia’s rapid economic growth and ongoing urban development have increased population density in flood-prone areas, with Riyadh a clear example of this trend. While the proportion of floodable properties has remained relatively constant between 2005 and 2025, the population living in these zones has grown by 81%. Rising property values, population growth and expanding insurance portfolios present a formidable challenge in narrowing the protection gap in the region.
As a result, catastrophe modeling is particularly important. Guy Carpenter has made significant investments to develop catastrophe models tailored specifically to Saudi Arabia. Guy Carpenter’s GCAT™ suite includes models for earthquake and flood risk. These models empower insurers and reinsurers to quantify risk accurately, price coverage appropriately and design effective risk transfer solutions.