Verisk Unveils First-of-Its-Kind SRCC Catastrophe Model for the U.S. to Quantify Political Violence Risks

Rhea-AI Summary

Verisk has launched the industry's first catastrophe model to assess financial impacts of strikes, riots and civil commotion (SRCC) in the United States. This groundbreaking development comes as SRCC events have caused over $10 billion in global insured losses since 2010, significantly outpacing terrorism-related losses of less than $1 billion.

The model features a 500,000-year stochastic catalog covering every U.S. ZIP Code, evaluating risk factors including social, economic, and political trends. Key highlights include:

• A 1-in-1000-year SRCC event could cause losses 10x greater than 2020 protests
• U.S. has experienced approximately $3 billion in SRCC insured losses
• Five events in past six years each caused over $1 billion in global insured losses

Available through Verisk's Touchstone platform, the model helps insurers estimate losses, create underwriting guidelines, assess tail risk, and meet regulatory requirements.

Positive

• First-mover advantage with industry's first SRCC catastrophe model for the U.S. market
• Model covers 500,000-year stochastic catalog across all U.S. ZIP codes, demonstrating comprehensive coverage
• Addresses growing $10B+ market opportunity in SRCC insurance losses since 2010
• Leverages 40 years of catastrophe modeling expertise combined with 15+ years of political violence analysis
• Product available through established Touchstone platform, enabling immediate commercialization

Negative

• Model predicts potential SRCC losses could be 10x greater than 2020 protest losses, indicating significant risk exposure
• Entering untested market segment with no comparable products for validation
• High-risk product focused on low-probability but high-impact events that could affect credibility if predictions are inaccurate

Insights

Financial Analytics Expert

Verisk's new SRCC model addresses a $10B market gap in civil unrest risk assessment, strengthening their insurance analytics position.

Verisk's launch of the industry's first-of-its-kind catastrophe model for strikes, riots, and civil commotion (SRCC) represents a strategic product innovation addressing a significant market need. The press release reveals that SRCC events have caused over $10 billion in global insured losses since 2010 ($3 billion in the US alone), substantially exceeding terrorism-related losses of less than $1 billion.

The technical capabilities are impressive: a 500,000-year stochastic catalog covering every US ZIP code that incorporates social, economic, and political factors. This sophisticated modeling approach enables insurers to overcome traditional reliance on historical data and subjective assessments – a clear gap in the market that Verisk is filling.

What makes this product particularly valuable is its integration of Verisk's 40-year catastrophe modeling expertise with Verisk Maplecroft's political violence quantification capabilities. This demonstrates effective leveraging of cross-divisional competencies to create a differentiated analytics offering.

For insurers, the model delivers four critical capabilities: better estimation of potential SRCC losses, more robust underwriting guidelines, assessment of tail risk through extreme but plausible scenarios, and tools to address risk management and regulatory requirements. The timing is strategic, given the press release notes five events in the past six years each causing over $1 billion in global insured losses.

This product strengthens Verisk's position in the insurance analytics market by addressing an underserved risk category with growing significance for insurers' underwriting and capital allocation decisions.

Since 2010, strikes, riots and civil commotion have led to more than USD 10 billion in insured losses, compared to less than USD 1 billion for terrorism

JERSEY CITY, N.J, April 30, 2025 (GLOBE NEWSWIRE) -- In response to escalating insurance losses from large-scale civil unrest events in recent years, leading global analytics and data provider Verisk (Nasdaq: VRSK) is releasing the industry’s first-of-its-kind catastrophe model to help quantify the financial impacts of strikes, riots and civil commotion (SRCC) in the United States.

Since 2010, strikes, riots, and civil commotion events have led to more than USD 10 billion in insured losses globally, compared to less than USD 1 billion for terrorism. In the past six years, the insurance industry has faced five events, each causing over USD 1 billion in global insured losses. Verisk’s new SRCC model was built to enhance the way underwriters and risk managers approach the increasing risk posed by SRCC events in the U.S., which has experienced approximately USD 3 billion in insured losses.

“Over recent years, unrest in the U.S. highlighted the necessity for insurers to have a comprehensive understanding of potential political risk hazards,” said Sam Haynes, vice president of data and analytics, Verisk Maplecroft. “A 1 in 1,000-year SRCC event could cause losses 10 times greater than those from the 2020 protests, while very low-probability SRCC tail events could potentially impact commercial and municipal properties at the ZIP code level nationwide, the majority of which are located in metropolitan areas.”

The Verisk SRCC Model for the U.S. has a 500,000-year stochastic catalog, capturing the frequency and severity across the spectrum of plausible loss-causing unrest across every ZIP Code in the country. It predicts the severity of an event by evaluating the key drivers of risk, including social and economic trends, political factors and historical protest patterns. The probabilistic model can provide enhanced insight for exposure management and catastrophe modeling teams that have traditionally been reliant on historical, generic civil unrest data and subjective assessments.

“Verisk’s goal is to empower insurers covering political violence and terrorism risks to enhance their underwriting strategies through insights on the riskiness of exposures. This will facilitate informed decisions on insurance pricing, capital allocation, risk management and mitigation,” said Shane Latchman, managing director of Verisk Extreme Event Solutions team in London. “Ultimately, this SRCC Model enables underwriters to balance risk and premium effectively and allow insurers to effectively model this risk.”

The SRCC Model combines almost 40 years of catastrophe modeling expertise from Verisk’s Extreme Event Solutions business with 15+ years of experience from its global risks business, Verisk Maplecroft, in quantifying political violence. This unique approach offers insurers and reinsurers a compelling solution that will enable them to:

• Estimate potential insured losses from SRCC events and quantify the potential financial impact of risk for individual locations and at the enterprise level.
• Create robust underwriting guidelines to specifically account for SRCC related damage and associated business interruption.
• Assess tail risk through a catalog of stochastic events which feature scenarios that are inherently plausible, but far worse than anything that has been seen historically.
• Address risk management and regulatory requirements by stress testing extreme disaster scenarios to reveal potential vulnerabilities before real disasters occur.
  

The SRCC Model is available through Verisk’s Extreme Events Solutions’ Touchstone platform.

Learn more here: https://www.verisk.com/products/srcc-model/

About Verisk 
Verisk (Nasdaq: VRSK) is a leading strategic data analytics and technology partner to the global insurance industry. It empowers clients to strengthen operating efficiency, improve underwriting and claims outcomes, combat fraud and make informed decisions about global risks, including climate change, extreme events, sustainability and political issues. Through advanced data analytics, software, scientific research and deep industry knowledge, Verisk helps build global resilience for individuals, communities and businesses. With teams across more than 20 countries, Verisk consistently earns certification by Great Place to Work and fosters an inclusive culture where all team members feel they belong. For more, visit Verisk.com and the Verisk Newsroom. 

Jason McGeown
Senior Director of Communications, Verisk Maplecroft
jason.mcgeown@maplecroft.com

FAQ

How much have strikes, riots, and civil commotion (SRCC) losses cost insurers since 2010 compared to terrorism?

SRCC events have caused over $10 billion in insured losses globally since 2010, while terrorism losses were less than $1 billion during the same period. In the US specifically, SRCC events resulted in approximately $3 billion in insured losses.

What is Verisk's (VRSK) new SRCC catastrophe model and how does it work?

Verisk's SRCC Model is the first catastrophe model for quantifying political violence risks in the US. It uses a 500,000-year stochastic catalog to predict event severity by analyzing social, economic, and political factors across every ZIP code in the country.

What is the potential maximum loss from an SRCC event according to Verisk's (VRSK) model?

According to the model, a 1 in 1,000-year SRCC event could cause losses 10 times greater than those from the 2020 protests, potentially impacting commercial and municipal properties nationwide, particularly in metropolitan areas.

How will Verisk's (VRSK) SRCC model help insurance companies manage risk?

The model helps insurers estimate potential losses, create underwriting guidelines, assess tail risk, and meet regulatory requirements. It enables better risk pricing, capital allocation, and risk management through the Touchstone platform.

How many billion-dollar SRCC events have occurred in recent years?

In the past six years, the insurance industry has faced five SRCC events, each causing over $1 billion in global insured losses.