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Strategic Advisory

Parametric Solutions

Explore Guy Carpenter’s innovative parametric solutions for fast, transparent and flexible risk transfer options to complement traditional indemnity coverage. Our current offerings can help you address wildfire, tropical cyclone, earthquake and flood risk.

Why Parametric Solutions?

Parametric solutions offer a variety of benefits including increased transparency, customization, versatility and speed of payment. At Guy Carpenter, we’ve gone a step further. Our solutions also include:

  • Basis Risk Minimization: We use advanced optimization techniques to minimize basis risk so you can purchase more efficient parametric coverage.
  • Model Risk Reduction: We conduct several sensitivity tests and employ model smoothing techniques to help clients understand and reduce the volatility of expected payments.
  • Versatility Deployment: Our flexibility of structuring and supporting risk capital, via (re)insurance or capital markets, allows coverage to be placed as efficiently as possible.
  • Research Backing: Our products are supported by extensive research which has been shared via numerous scientific publications.

Contact Us

  • Guillermo Franco

    Managing Director, Global Head of Cat Risk Research

    Guillermo.Franco

Products

  • GC FireCell®

    GC FireCell provides customized wildfire coverage based on data provided by NASA and NOAA-operated satellites as well as other fire management agencies on a real-time basis.

  • GC StormGrid®

    GC StormGrid provides customized tropical cyclone coverage based on storm track information published in real time by global meteorological agencies using a high-resolution parametric model.

  • GC QuakeCube®

    GC QuakeCube is a customized, high-resolution cat-in-a-box product for earthquake coverage that leverages the simplicity and global applicability of cat-in-a-box approaches while minimizing basis risk.

  • GC FloodShield℠

    GC FloodShield provides customized flood coverage based on hazard footprints obtained in near real time.
  • We aim to complement (traditional coverage) and find new solutions to problems that existed that maybe we had given up trying to solve.”

    Guillermo Franco, (Global Head of Cat Risk Research)

Case Studies

Our parametric solutions have proven results that have supported clients in efficiently transferring risk and securing access to quick and transparent payouts.

Research and Innovation

Guy Carpenter is committed to sharing our research and innovating our products in collaboration with our university partners and organizations.

  • A Biased-Randomized Algorithm for Optimizing Efficiency in Parametric Earthquake (Re)insurance Solutions

    We created GC QuakeCube’s sophisticated optimization algorithm, refined over several years, with its current formulation documented in a scientific paper written in collaboration with the Universitat Oberta de Catalunya.

  • Design of Parametric Risk Transfer Solutions for Volcanic Eruptions: An Application to Japanese Volcanoes

    We published a methodology to construct parametric solutions for volcanic eruptions in collaboration with Macquarie University.

  • Use of USGS ShakeMap for Parametric Earthquake Transactions

    We investigated USGS’s ShakeMap, a tool to estimate ground motion fields after an event, and the conditions under which using it is advisable for parametric solutions.

  • Typology and Design of Parametric Cat-in-a-Box and Cat-in-a-Grid Triggers for Tropical Cyclone Risk Transfer

    We explored the basis risk of cat-in-a-box and cat-in-a-grid triggers (i.e. GC StormGrid), the methods and conclusions of which were documented in a scientific paper.

  • Coming Soon

    We're quantifying the reduction in insurance premiums due to presence of mangroves finding the most impactful reductions for localized regions in collaboration with University of California, Santa Cruz.

Powering Your Business With Insights

  • Segments

    Offering you specialized expertise that focuses market knowledge, product innovation and analytics on your unique challenges—to provide you with an enduring competitive advantage.

  • Risks

    Bringing together an unparalleled depth and breadth of capabilities and experience to turn your risks into profit and sustained growth.

  • Reinsurance Broking

    Tailoring your solutions to effectively and efficiently match the right capital with your evolving risk profile.

Press Release: Guy Carpenter Advances Research on the Use of Parametric Solutions through Community-Based Reciprocal Exchanges

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