--- title: A Cat Modeler's Guide to the Protection Gap description: Why would insurers look beyond filling this protection gap for perils they underwrite already? It is opportunity that is begging to be taken, and something risk scoring can help with. image: https://www.goinsitepro.com/hubfs/Blog%20Images/news_banner.png --- [![InsitePro Logo](https://www.goinsitepro.com/hs-fs/hubfs/InsiteProGlobe-with-text-web-2.png?width=500&name=InsiteProGlobe-with-text-web-2.png "InsitePro Logo")](https://www.goinsitepro.com/) [![InsitePro Logo](https://www.goinsitepro.com/hs-fs/hubfs/insitepro_2018/images/InsitePro4%20(1).png?width=500&name=InsitePro4%20(1).png "InsitePro Logo")](https://www.goinsitepro.com/) [Contact Us](http://www-goinsitepro-com.sandbox.hs-sites.com/contact-us) | [+1 877-837-7246](tel:+1%20877-837-7246) - [Why InsitePro](https://www.goinsitepro.com/why-insitepro) - [Flood](https://www.goinsitepro.com/flood-insurance) - [Wildfire](https://www.goinsitepro.com/wildfire-insurance) - [Retail Agents](https://www.goinsitepro.com/retail-agents) - [About](https://www.goinsitepro.com/about-intermap) - [Blog](https://www.goinsitepro.com/blog) ## A Cat Modeler's Guide to the Protection Gap Posted at Feb 16, 2016 10:00:00 AM by [Ivan P. Maddox](https://www.goinsitepro.com/blog/author/ivan-p-maddox) - [Tweet](https://twitter.com/share) ![news_banner](https://www.goinsitepro.com/hubfs/Blog%20Images/news_banner.png) Last week on AMBest TV there was an [interview](http://www3.ambest.com/ambv/displaycontent/video.aspx?rc=shah116) with [Hemant Shah](https://www.linkedin.com/in/hemant-shah-a5789436?authType=NAME_SEARCH&authToken=C-bm&locale=en_US&trk=tyah&trkInfo=clickedVertical%3Amynetwork%2CclickedEntityId%3A127597027%2CauthType%3ANAME_SEARCH%2Cidx%3A1-1-1%2CtarId%3A1455556213394%2Ctas%3Ahemant%20sha), the articulate co-founder and CEO of cat-model makers RMS. It was a standard set of questions one would ask a cat modeler, but there was one response that’s worth a deeper look. ![Shah_RMS_AMBest_TV.png](https://www.goinsitepro.com/hs-fs/hubfs/Risks%20of%20Hazard%20Blog%20Posts/Shah_RMS_AMBest_TV.png?width=320&name=Shah_RMS_AMBest_TV.png "Shah_RMS_AMBest_TV.png") The initial questions to Mr. Shah were answered with answers he has down pat, presumably because he is ALWAYS asked them. - “It’s been a while since Florida had a hurricane. Are we overdue for a hit?” *Overdue is unclear…but all it takes is one.* - “Is the insurance industry ready for another Katrina?” *Yes, … but I worry more about our focus on events like Katrina because the tail is very long.* - “What events could be bigger than Katrina?” *Atlantic hurricane hitting the big cities, New Madrid quake, West Coast quake…* These responses are uncontroversial, and pretty much exactly right. The next part of the conversation might also be standard for Mr. Shah’s interviews, but his response resonated with me unlike the first half of the interview. It was a perspective that really needs greater adoption in the industry. The question was “What risk is the insurance industry not ready to handle?”. This is where typical answers tend towards things like cyber risk, terrorism risk, self driving cars, and other risks associated with emerging technologies. Mr. Shah immediately responded (at 2:18 of the clip): > *I worry more about the risks the insurance industry is not covering right now.* In other words, he called out the [Protection Gap](http://www.swissre.com/media/news_releases/Underinsurance_in_property_is_a_global_and_growing_challenge_says_latest_Swiss_Re_isigmai_study.html). The remainder of the interview is a cogent description of that gap (spoiler: he only uses the word “disgraceful” once). ![insurance_gap_lifehealthprod.com_.jpg](https://www.goinsitepro.com/hs-fs/hubfs/Risks%20of%20Hazard%20Blog%20Posts/insurance_gap_lifehealthprod.com_.jpg?width=356&name=insurance_gap_lifehealthprod.com_.jpg "insurance_gap_lifehealthprod.com_.jpg") What a good answer. Rather than worry about new risks, that are very difficult to assess and underwrite because they are so new and not-well-understood, insurers should be focusing on covering the risks for which they DO have analytics and data. Looking at quake: [New Madrid](https://www.goinsitepro.com/risks-of-hazard-blog/2015/08/new-madrid-fault-line-concerns) has 20% of homes in the region covered for quake, [Cascadia](https://www.goinsitepro.com/risks-of-hazard-blog/2015/08/new-madrid-cascadia) quake is vastly underinsured, and [California has less quake coverage penetration than Nepal](https://www.goinsitepro.com/risks-of-hazard-blog/2015/09/nepal-or-california-who-has-more-earthquake-coverage) (even though everyone knows it’s going to shake again someday). For flood, only about 20% of the homes damaged in the [South Carolina](https://www.goinsitepro.com/risks-of-hazard-blog/2015/10/making-sense-of-the-south-carolina-floods) floods of late 2015 were covered for flood. And the list goes on. Why would insurers look beyond filling this protection gap for perils they underwrite already? It is opportunity that is begging to be taken; it is risk waiting to be underwritten, and an avenue to growth open for bold insurers. The necessary data and analytics are available now. Topics: [Floods](https://www.goinsitepro.com/blog/topic/floods), [Insurance Underwriting](https://www.goinsitepro.com/blog/topic/insurance-underwriting), [Natural Catastrophe](https://www.goinsitepro.com/blog/topic/natural-catastrophe), [Other Risk Models](https://www.goinsitepro.com/blog/topic/other-risk-models), [Earthquake](https://www.goinsitepro.com/blog/topic/earthquake) ### Comment Form ![sidebar-bg](https://www.goinsitepro.com/hs-fs/hubfs/sidebar-bg.jpg?width=280&name=sidebar-bg.jpg "sidebar-bg") # The Risks of Hazard Blog Welcome to The Risks of Hazard, brought to you by Intermap Technology. From the latest industry news and trends, to insight from thought leaders around the globe, stay tuned for a variety of content aimed at helping you better understand the role of location-based intelligence in the world of insurance underwriting and risk assessment. ![sidebar-bg](https://www.goinsitepro.com/hs-fs/hubfs/sidebar-bg.jpg?width=280&name=sidebar-bg.jpg "sidebar-bg") ### Subscribe to the Risks of Hazard blog! ![sidebar-bg](https://www.goinsitepro.com/hs-fs/hubfs/sidebar-bg.jpg?t=1539078502257&width=280&name=sidebar-bg.jpg "sidebar-bg") ### Posts by Tag - [Flood Insurance (60)](https://www.goinsitepro.com/blog/tag/flood-insurance) - [Insurance Underwriting (60)](https://www.goinsitepro.com/blog/tag/insurance-underwriting) - [Risk Management (41)](https://www.goinsitepro.com/blog/tag/risk-management) - [Flood Risk (39)](https://www.goinsitepro.com/blog/tag/flood-risk) - [Insurance Protection Gap (29)](https://www.goinsitepro.com/blog/tag/insurance-protection-gap) - [Flood Modeling (27)](https://www.goinsitepro.com/blog/tag/flood-modeling) - [Property Insurance (26)](https://www.goinsitepro.com/blog/tag/property-insurance) - [Natural Catastrophe (25)](https://www.goinsitepro.com/blog/tag/natural-catastrophe) - [Natural Hazard Risk (25)](https://www.goinsitepro.com/blog/tag/natural-hazard-risk) - [Private Flood (25)](https://www.goinsitepro.com/blog/tag/private-flood) - [InsitePro (21)](https://www.goinsitepro.com/blog/tag/insitepro) - [Floods (19)](https://www.goinsitepro.com/blog/tag/floods) - [Insurance Technology (17)](https://www.goinsitepro.com/blog/tag/insurance-technology) - [Wildfire (17)](https://www.goinsitepro.com/blog/tag/wildfire) - [Insurance Software (16)](https://www.goinsitepro.com/blog/tag/insurance-software) - [Risk Scoring (14)](https://www.goinsitepro.com/blog/tag/risk-scoring) - [Effective Underwriting (13)](https://www.goinsitepro.com/blog/tag/effective-underwriting) - [Earthquake (12)](https://www.goinsitepro.com/blog/tag/earthquake) - [Other Risk Models (11)](https://www.goinsitepro.com/blog/tag/other-risk-models) - [NFIP (10)](https://www.goinsitepro.com/blog/tag/nfip) - [Risk Models (8)](https://www.goinsitepro.com/blog/tag/risk-models) - [Hurricane (7)](https://www.goinsitepro.com/blog/tag/hurricane) - [Houston (6)](https://www.goinsitepro.com/blog/tag/houston) - [Big Data (5)](https://www.goinsitepro.com/blog/tag/big-data) - [Flood News (5)](https://www.goinsitepro.com/blog/tag/flood-news) - [Innovation in Insurance (5)](https://www.goinsitepro.com/blog/tag/innovation-in-insurance) - [Insurance News (5)](https://www.goinsitepro.com/blog/tag/insurance-news) - [Cloud Computing (4)](https://www.goinsitepro.com/blog/tag/cloud-computing) - [Hail (4)](https://www.goinsitepro.com/blog/tag/hail) - [Underwriting Profit (4)](https://www.goinsitepro.com/blog/tag/underwriting-profit) - [FEMA (3)](https://www.goinsitepro.com/blog/tag/fema) - [Insurance Disruption (3)](https://www.goinsitepro.com/blog/tag/insurance-disruption) - [Location-Based Intelligence (3)](https://www.goinsitepro.com/blog/tag/location-based-intelligence) - [Terrain Data (3)](https://www.goinsitepro.com/blog/tag/terrain-data) - [Analytics (2)](https://www.goinsitepro.com/blog/tag/analytics) - [Blogs (2)](https://www.goinsitepro.com/blog/tag/blogs) - [California (2)](https://www.goinsitepro.com/blog/tag/california) - [Fire Insurance (2)](https://www.goinsitepro.com/blog/tag/fire-insurance) - [Geocoding (2)](https://www.goinsitepro.com/blog/tag/geocoding) - [Agreement (1)](https://www.goinsitepro.com/blog/tag/agreement) - [Canada Flood Risk (1)](https://www.goinsitepro.com/blog/tag/canada-flood-risk) - [Conference (1)](https://www.goinsitepro.com/blog/tag/conference) - [Coverholders (1)](https://www.goinsitepro.com/blog/tag/coverholders) - [Data Management (1)](https://www.goinsitepro.com/blog/tag/data-management) - [Data and Models (1)](https://www.goinsitepro.com/blog/tag/data-and-models) - [GAO (1)](https://www.goinsitepro.com/blog/tag/gao) - [Global Flood Map (1)](https://www.goinsitepro.com/blog/tag/global-flood-map) - [Government (1)](https://www.goinsitepro.com/blog/tag/government) - [Inside Intermap (1)](https://www.goinsitepro.com/blog/tag/inside-intermap) - [Pipeline Operations (1)](https://www.goinsitepro.com/blog/tag/pipeline-operations) - [Survey (1)](https://www.goinsitepro.com/blog/tag/survey) - [Technologies (1)](https://www.goinsitepro.com/blog/tag/technologies) - [Top Ten (1)](https://www.goinsitepro.com/blog/tag/top-ten) - [Top Three (1)](https://www.goinsitepro.com/blog/tag/top-three) see all [![InsiteProGlobe-with-text-web-1](https://www.goinsitepro.com/hs-fs/hubfs/InsiteProGlobe-with-text-web-1.png?width=1062&name=InsiteProGlobe-with-text-web-1.png "InsiteProGlobe-with-text-web-1")](https://www.goinsitepro.com/) ©2026 Intermap Technologies®. All rights reserved. - [Legal](https://www.goinsitepro.com/intermap-legal-information) - [Disclaimer](https://www.goinsitepro.com/disclaimer) - [Terms of Use](https://www.goinsitepro.com/intermap.com-terms-of-use)