Managing cloud outage risk exposure
Our technology helps insurers and reinsurers assess and measure their vulnerability to cloud outage risks and find the best way to control, mitigate and transfer these risks.
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What happens when the cloud goes down?
Re/insurers are exposed to the accumulation of cloud outage risk through contingent business interruption (CBI) coverage granted under cyber insurance policies.
Long-duration outages of widely used cloud infrastructure can cause financial losses to the insured that could be translated to significant insurance losses in their portfolios.
Many insurers lack a clear view of their risk exposure to cloud outage. They have difficulty identifying and quantifying the risk, and consequently, face challenges in devising effective risk management or transfer strategies.
Our Technology and models help re/insurers to detect their clients cloud infrastructure, identify major accumulation points, and estimate the insurance losses in cases of different RDSs.
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The technology we need to create the products you need.
Parametrix Cloud Monitoring System
Parametrix's proprietary cloud monitoring technology tracks the availability and performance of cloud-based services worldwide and enabled us to define the first cloud outage index.
We continuously track and analyze the dependencies between different Saas, PaaS and IaaS platforms, collecting granular data with detection capabilities down to the millisecond.
Parametrix monitoring technology is the first of its kind, providing uniform measures and statistics across all the cloud service providers. It detects in real time, any outage event, measuring both the duration and severity.
Using external and non-intrusive techniques, we produce over 900M data points from 250 data centers across the globe every week. These billions of data points that have been collected in the years also serve as a unique and an unparalleled data source for understanding and modeling cloud outages.
Using external and non-intrusive techniques, we produce over 900M data points from 250 data centers across the globe every week. These billions of data points that have been collected in the years also serve as a unique and an unparalleled data source for understanding and modeling cloud outages.
How Parametrix can help
Identifying cloud outage risk and measuring exposure
Parametrix uses proprietary technology and models to analyze cyber portfolios and risk exposure through:
- Estimating the exposure to individual cloud service providers and regions
- Identifying points of risk aggregation
- Quantifying the loss for various cloud outage realistic disaster scenarios (RDS), and
- Estimating losses incurred at various return periods
Structuring
the best risk transfer solution
Key considerations when determining and structuring the best risk transfer solution include:
- Re/insurers’ risk appetite
- Risk retentions (waiting periods, deductibles)
- Parametric triggers, and
- Levels of indemnity
Parametrix is uniquely equipped to support the structuring of a parametric solution to indemnify against losses from cloud outage events, and to provide the pricing and modeling support to estimate the costs and feasibility of proposed solutions.
Executing the appropriate risk transfer mechanism
Two solutions that accomplish this are:
- Bespoke insurance policies, and
- Insurance-linked securities (ILS)
Whichever solution is sought, Parametrix can provide the analytic tools needed to facilitate such a transaction as well as act as a calculating agent and provide the index on which the deal would be based.
ILS White Paper: Cloud-in-a-Box Securitizing Cloud Outage Risk
This paper from Parametrix focuses on parametric cloud outage ILS structures and includes the following:
- The global cloud services market
- Demand for cloud otuage risk transfer
- Characteristics of parametric cloud downtime transactions
- Definitions, models, and monitoring
- Key benefits to ILS investors
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The products and services referred to on this website are available only in the jurisdictions in which we are licensed to transact insurance business. Nothing on this website shall be construed as an offer or solicitation to purchase insurance in any other jurisdiction. The availability, terms, and conditions of such products and services may vary by jurisdiction. The list of licenses held by Parametrix Insurance Services LLC as an insurance producer and surplus lines broker in the US states can be viewed on our license page. Parametrix provides insurance products in connection with potential downtime on services represented by brands which this website displays. Parametrix is not affiliated to, associated with, or sponsored by the owners of these brands.