PCS® estimates are widely accepted as triggers in many traded financial market instruments, including exchange-traded futures and options, catastrophe bonds, catastrophe swaps, industry loss warranties (ILWs), and other catastrophe derivative instruments.
The PCS Catastrophe Loss Index offers the reliability, consistency, and transparency that issuers of insurance-linked securities (ILS) need to make smarter decisions with their capital. Many catastrophe bonds and industry loss warranty issuers choose the PCS Catastrophe Loss Index because PCS:
PCS assigns a catastrophe serial number to loss events in the United States, Puerto Rico, and the U.S. Virgin Islands that cause $25 million or more in insured property losses and affect a significant number of policyholders and insurers. The PCS catastrophe serial number lets insurers track losses and reserves related to a single discrete event. In addition, many reinsurance contracts use PCS serial numbers to determine which losses will trigger reinsurance coverage.
PCS’s long-standing reputation for accurately defining and tracking catastrophes helps to reduce disputes between primary insurers and reinsurers, saving the industry millions of dollars in staff and legal expenses each year. PCS catastrophe serial numbers are an industry standard available to all PCS subscribers.