Updated Hurricane Loss Model Approved by Florida Commission

Karen Clark & Co. (KCC) has received approval from the Florida Commission on Hurricane Loss Projection Methodology for its newly updated Version 5.0 hurricane loss model. This marks the first model to meet the commission’s most recent standards, reflecting ongoing efforts to improve the accuracy of catastrophe modeling in the face of evolving climate data.

The new model includes two additional years of climate and storm data, as well as a suite of technical upgrades. Among these are enhanced vulnerability functions for appurtenant structures and manufactured homes, as well as new support for secondary building characteristics. The model also allows for the assessment of law and ordinance coverage and roof actual cash value endorsements—key elements in residential and commercial property insurance.

Designed for use by insurers and reinsurers, the updated KCC model supports a wide range of pricing, underwriting, and risk management decisions. These tools are crucial for forecasting hurricane-related losses and maintaining solvency in storm-prone regions like Florida.

This certification comes as the current set of model approvals under the 2021 standards are set to expire in November. KCC joins six other approved vendors, as the commission continues its role in auditing and validating catastrophe models used throughout Florida’s insurance market. Notably, this approval follows last year’s acceptance of new flood models from multiple sources, including KCC and academic institutions.