Press Release

For the first time (re)insurers will be able to model liability exposure probabilistically across their entire portfolios thanks to an innovative new data-driven methodology developed by Lloyd’s, the specialist insurance and reinsurance market, and modelling company Arium.

The new approach categorises casualty events based on a company’s business activities –its products and services, operations and infrastructure – and maps the economic relationships that reflect the journey of products and services through the economy.

The innovative methodology creates liability “storm tracks”, which provide a new, structured way of analysing casualty events, regardless of risk classification. This allows insurers to model liability risk in more detail than they have previously, in a way similar to how they model catastrophe exposure.

This approach aims to help create a more robust insurance industry, strengthening its ability to pay claims to its customers.

The methodology is the culmination of a three-year project between Lloyd’s and Arium to improve insurers’ understanding of liability risk exposure.

Jon Hancock, Lloyd’s Performance Management Director, said:
“This is a tremendously exciting development. It is in everybody’s interest to classify liability risks as accurately as possible, and this methodology represents a real step forward for the industry. Of course, for it to work effectively it is dependent on high-quality industry classification data, and I would encourage all brokers and other stakeholders to help with the collection of such data.”

Trevor Maynard, Lloyd’s Head of Innovation, said:

“I am delighted that Lloyd’s has helped to incubate Arium from concept stage to a platform supporting portfolio management as well as deterministic and stochastic modelling of liability exposures. It is very positive that AIR Worldwide has purchased Arium to further commercialize this tool.”

Robin Wilkinson, CEO of Arium and managing director of AIR Casualty Analytics, said: “Arium is pleased to have collaborated with Lloyd’s and the insurance market on the development of this liability tool, and now a methodology for a stochastic model. This framework can facilitate the further understanding of liability accumulations, through combining expert knowledge with data-driven analytics.”

To read the full report, visit:

About Lloyd’s

Lloyd's is the world's specialist insurance and reinsurance market. Under our globally trusted name, we act as the market's custodian. Backed by diverse global capital and excellent financial ratings, Lloyd's works with a global network to grow the insured world –building resilience of local communities and strengthening global economic growth.
With expertise earned over centuries, Lloyd's is the foundation of the insurance industry and the future of it. Led by expert underwriters and brokers who cover more than 200 territories, the Lloyd’s market develops the essential, complex and critical insurance needed to underwrite human progress. For more information, please visit

About Arium

Arium specialises in developing risk models primarily for the reinsurance industry. It tackles problems that are data poor and considered complex or unpredictable. Its approach is underpinned by the use of adapted techniques such as networks and dependency modelling. Arium has been developing a liability exposure management tool to help underwriters and management understand and manage casualty accumulation risk. Arium is part of AIR Worldwide, a Verisk Analytics business. For more information, please visit



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