AIR Provides Risk Modeling and Analytical Services for $2 Billion in Catastrophe Bonds to Date in 2008

BOSTON, Sept. 24, 2008 – AIR Worldwide Corporation (AIR) today announced that it has provided risk modeling and analytical services for 2 billion dollars in insurance-linked securities to date this year, or nearly 70% of 2008 new issuances.

“The investor base is expanding for insurance-linked securities, increasing the market appetite for deals covering a broad range of regions, perils as well as structures,” said David Lalonde, senior vice president at AIR Worldwide. “With models covering more than 50 countries worldwide and experience working with all types of bonds, AIR continues to be the modeler of choice for companies pursuing potential securitization options.”

In 2008 to date, AIR Worldwide has modeled the risk profile for securities covering North America, Europe and Asia, while protecting against such perils as tropical cyclones, earthquakes, extratropical cyclones (winter storms), severe thunderstorms and wildfires. These instruments employ a variety of trigger types, ranging from parametric, indemnity and PCS® industry loss index based, to a ground-breaking new hybrid trigger based on a combination of PCS industry loss and modeled loss.

Among many ILS transactions, AIR was also involved in the pioneering Blue Coast Ltd. bond which used the recently developed LAZR (Long-Term Aggregate Zonal Reinsurance) hybrid trigger combining state-level PCS industry loss estimates and AIR’s model losses by county. The Blue Coast structure provides investors with the clarity of a PCS trigger, while disaggregating loss estimates using AIR’s post-event loss calculation methodology to enable the issuer to manage basis risk at a more granular level.

“We expect to see much more use of this kind of structure,” said Erik Manning, director at Deutsche Bank. “This provides a greater level of transparency to both investors and the insurers currently holding the underlying catastrophe risk.”

A key element of the rating process for catastrophe bonds is the risk modeling.  AIR performs the underlying analysis, detailing the risk to the proposed bond. Additionally, AIR provides support for the offering materials and for the investor and rating agency meetings. AIR also provides investors with the tools necessary to fully understand the risk including documentation on the models, modeling assumptions, what-if analyses of historical events, and breakdowns of risk by region and peril.

“AIR's role does not end with the modeling of individual bonds,” continued Lalonde. “AIR also provides investors in insurance-linked securities with a complete solution that combines AIR’s industry-leading CATRADER® software with the highest quality information compiled by the same experienced team that has modeled more than $9 billion of new issuances.”

AIR is the leading provider of catastrophe risk modeling and analytical services for insurance-linked securities. Since modeling the first catastrophe bond in 1996, AIR has participated in many of the insurance industry's landmark securitization transactions. In 2007, AIR provided modeling support for more than 3 billion dollars in insurance-linked securities and thus far in 2008, AIR has provided risk modeling and analytical services for nearly 70% of the insurance-linked securities issued.

About AIR Worldwide Corporation
AIR Worldwide Corporation (AIR) is the scientific leader and most respected provider of risk modeling software and consulting services. AIR founded the catastrophe modeling industry in 1987 and today models the risk from natural catastrophes and terrorism in more than 50 countries. More than 400 insurance, reinsurance, financial, corporate and government clients rely on AIR software and services for catastrophe risk management, insurance-linked securities, site-specific wind and seismic engineering analyses, and property replacement cost valuation. AIR is a member of the ISO family of companies and is headquartered in Boston with additional offices in North America, Europe and Asia. For more information, please visit .

Release: Immediate

Kevin Long
AIR Worldwide

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