Praedicat has built a successful product, CoMeta, helping casualty re/insurers identify and quantify emerging risks that might give rise to significant aggregate claims.

Its AI-based technology mines peer-reviewed scientific literature, and models scientific and economic data to produce predictive analytics about commercial activities or products that cause bodily injury, latent property damage or environmental damage.

Over the last few years, the Californian firm has expanded that approach to tackle climate risks in three dimensions: developing models for 'tail risk' climate liability scenarios; tracking climate-related litigation; and scoring climate liability risks.

Understanding climate liability is vital for casualty insurers. As Praedicat explains: "While governments and corporations promise to slash future greenhouse gas emissions to stave off planetary catastrophe, plaintiffs are suing in court to press for a more rapid transition to net-zero and redress the harms already incurred."

The core of Praedicat's offering is a set of climate liability scenarios that contemplate a range of climate-induced litigation events that could trigger general liability, D&O and workers' compensation policies.

Climate litigation to date has tended to focus on fossil fuel producers, but this is spreading into other sectors of the economy, making risk management more challenging than simply limiting exposures to oil and gas, the company notes. The scenarios help insurers measure how events could aggregate in their casualty books.

CoMeta also tracks details of every climate complaint filed in US state and federal courts, so that underwriters and claims managers can monitor how litigation unfolds.

Finally, CoMeta is adding climate risk scores to its existing corporate scoring system, which summarises a company's exposure to approximately 280 emerging risks.

The climate risk score will leverage public data on greenhouse gas emissions, but will be supplemented by company-specific liability scenario results, so insurers do not miss firms with low emissions that nonetheless may have significant climate liabilities, such as the meat production sector.

The judging panel commended Praedicat for producing a "highly effective tool with analytics allowing for actionable solutions to emerging risks", and for addressing the urgent need for data and modelling related to climate change litigation.