Global insurance broker and risk advisory firm Willis has announced a new scientific collaboration with researchers from Cornell University and the Atkinson Center for a Sustainable Future.
The partnership proposed by Willis focuses on identifying new risks associated with relevant natural disasters. Supported by an initial one-year funding agreement, the research aims to give insurers and reinsurers a clearer understanding of how major risks occur together and what this means for the industry’s overall major loss risk.
Willis said natural disasters remain a major source of claims for insurers and reinsurers, prompting continued monitoring of patterns in events such as tropical cyclones, wildfires and severe convective storms.
The industry has traditionally relied on geographic diversification to limit risk exposure, under the assumption that major events are unlikely to occur in different regions within the same year. Willis noted that historically, correlations between different risks have been limited, and existing models often fail to justify holding additional capital to protect against multiple large-scale events occurring simultaneously.
Willis said that assumption may no longer hold true in the future as climate changes. The company explained that it is not yet fully understood how changing climate conditions affect the relationship between different types of natural disasters.
Through this collaboration, Willis and Cornell researchers will assess whether correlations between major hazards are already increasing and will model how these relationships develop over the next one to five years. The Cornell research will be supported by the Atkinson Center for Sustainability and conducted by Dr. Jonathan Lin, Dr. Toby Ault, and Dr. Flavio Lehner of the university’s Department of Earth and Atmospheric Sciences.
Scott St. George, director of weather and climate research at Willis Research Network, commented: “In a changing world, we cannot just look in the rearview mirror. Geographic diversification has served the insurance industry well in the past, but if disasters become more relevant, that strategy will no longer be effective. Our partners at Cornell will help us identify the true risk of relevant disasters today and prepare for the greater synchronicity that may arise in the near future.”
“Understanding how multiple natural hazards play out in a warming world is becoming increasingly important for reinsurers, who have traditionally modeled the risk of different hazards independently,” said Cameron Rye, director of natural catastrophe analysis at Willis Re. “By combining Cornell’s cutting-edge research with Willis’ deep industry experience, we can give clients a clearer understanding of changing catastrophe risks and support more resilient decision-making.”
Professor Toby Ault, associate professor in the Department of Earth and Atmospheric Sciences at Cornell University, added: “We are pleased to partner with WTW to translate cutting-edge climate and atmospheric science into actionable insights for the insurance industry.
“Our research shows that accurately assessing the risks associated with climate change requires accounting for the chaotic nature of weather through large ensemble simulations and physics-based statistical analyses. By combining our expertise in drought research, climate change, and hurricane risk with WTW’s industry knowledge, we can better prepare for the complex climate risks of the future.”
