Daily Digest: Conduit Re warn on cat model recalibration, Convex gains US reciprocal status, MCI launches infectious disease cover

Conduit Re warns of 'radical recalibration' of catastrophe models Cedants have been warned to expect a dramatic adjustment in the modelling of excess-of-loss covers at the forthcoming renewals. In an interview with Insurance Day, senior executives at Conduit Re said the rising cost of catastrophe losses is forcing reinsurers to reassess how they use models in their risk analysis. “We are seeing a number of changes coming through. Even as we speak, pricing models are being adjusted in the marketplace,” Trevor Carvey, Conduit Re’s chief executive and chief underwriting officer, said. “The main challenge for the market, which is coming to terms with climate change and the increased frequency and severity of natural catastrophe events, is to radically recalibrate its reliance on the models,” he added. This is particularly the case with excess-of-loss business where data and level of information on the underlying policies being covered is often not as granular, Carvey said.