Lessons from disaster
Insurers have implemented sophisticated catastrophe risk models in the years since hurricane Katrina hit the US Gulf coast in 2005. How have these models performed and what lessons can the banking sector draw from them? By Clive Davidson
The financial crisis has left people grasping for words to adequately describe its impact. 'Meltdown', 'collapse' and 'carnage' are just some of the adjectives used, most of which are synonyms for disaster. The reach for an analogy with natural calamities is not simply for graphic effect, but helps provide a mental and emotional context in which we relate to the scale and destructive force of the events.
But perhaps something can be learned from drawing an analogy between the financial crisis
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