Leveraging climate research in ILS decision-making: Aeolus interview

This new Artemis Live video saw us interviewing senior executives at insurance-linked securities (ILS) and reinsurance investment manager Aeolus Capital Management, to discuss their ongoing program of climate risk research and how that is playing into investment decision-making at the firm.

Aeolus’ Chief Analytics Officer, Frank Fischer and Head of Research, Dr. Pete Dailey, joined us to explain how the program of climate risk research is playing an increasingly important role for the company.

Viewers may recall Pete and Frank joining us back in November 2021, for an interview in which we discussed the Aeolus view on climate risk and climate change.

Fast-forward around six months and Aeolus has continued to put extensive effort into its climate risk related research, with a new paper published recently about the influence of climate change on hurricanes.

So, in this new interview we got an update on the Aeolus view of climate risk, how the research is going, how these efforts are influencing the firm’s ILS decision-making and some more in-depth thoughts on the role of research information and data on risk selection and ILS portfolio management.

Frank Fischer explained that climate risk or change and how ILS investment managers approach researching these issues, is an ongoing concern for investors, even during a period of elevated global uncertainty such as we see today.

“On climate change specifically, I think what we’re finding now, is that investors are more willing to take the time to come back to the table, and really understand and dig deeper into managers and how they’re leveraging research and what they’re doing to try to get the right answer,” Fischer said.

Dailey provided some insight into what the embedding of a climate research function into Aeolus’ business operations means for the ILS and reinsurance investment managers clients.

“The good news for our investors is now that with an explicit research function, the Aeolus view of risk will be evaluated annually and consider the very latest data, the very latest information from the previous seasons actual events, and the evolving climate science,” Dailey explained.

The full video interview is embedded below and can also be viewed in full, along with previous Artemis Live video interviews, over on our YouTube channel.

You can also listen in audio to all of our interviews by subscribing to the Artemis Live podcast here.

All of our Artemis Live video interviews have a focus on reinsurance, ILS and the efficiency of risk transfer and can be accessed directly from our YouTube Channel.

You can also listen in audio to these interviews by subscribing to the Artemis Live podcast here.

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