New Berkshire Unit Will “Deconstruct” Models, Plans More Hires

New Berkshire Unit Will “Deconstruct” Models, Plans More Hires

A newly created unit within Berkshire Hathaway Specialty Insurance (BHSI) will be on hiring binge in the coming months as the unit ramps up a group that will overlay the firm’s own analysis onto client risks and third-party catastrophe models.

“We expect to be adding specific engineering, science, and financial modeling expertise to the team,” says Akshay Gupta, newly appointed senior vice president and head of BHSI’s Catastrophe Engineering & Analytics group. “This group will be a core functionality for BHSI.”

Earlier this week BHSI announced that it had hired Gupta away from catastrophe modelling firm AIR Worldwide, where he was senior vice president in charge of AIR’s Catastrophe Risk Engineering (CRE) practice.

A spokesman for AIR said that Dr. Marc Ramirez, senior principal engineer at the firm, will now oversee the CRE practice and will also take over management of the firm’ San Francisco office.

“[Akshay] will lead our efforts to integrate state-of-the-art catastrophe science and engineering with the best of the industry’s catastrophe modeling to form our view of location-level and large-scale risk − benefiting both our product development and our customers’ efforts to better understand and mitigate their risk and reduce loss costs,” said Sanjay Godhwani, executive vice president at BHSI in a statement.

Berkshire’s newly created group with focus on developing “an engineering based view of our customers risk, especially for customers with large, complex, and unique risks that may not be appropriately modeled using off-the-shelf technologies,” Gupta says.

“We fully expect to be working closely with the third-party modeling firms in obtaining an in-depth understanding of their models and their applicability to our customers risks and to our portfolio,” Gupta says “BHSI seeks to, in a manner of speaking, deconstruct the available models and integrate our own understanding of customers risks to develop a unique view of the risk.  Simply put, we are looking to take available tools, improve them through our science and engineering, and apply and utilize them appropriately at the location and portfolio levels, without an over reliance or dependence on the same.”

Using internally constructed tools that include location level and Berkshire portfolio data, Gupta says that Catastrophe Engineering & Analytics group will have a better understanding of the “true risk” of a customer’s portfolio.

“It is an integral part of BHSI’s value proposition to our customers in being a stable and meaningful long term capacity  provider,” he added.



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