Moody’s has announced that it has launched its North America Severe Convective Storm HD Models, which according to the firm redefines the standard for assessing tornado, hail and wind risk.
With SCS losses continuing to rise, the majority of existing models reportedly still struggle with a number of fundamental limitations, such as coarse hazard resolution, small event sets, simplified vulnerability curves and constrained financial modules.
Moody’s recently revealed that insured losses from U.S. SCS events reached $42 billion in the first nine months of 2025, with average per-event costs running 31% higher than the prior decade’s average, which sets up what the firm described as a new “normal” for extreme weather.
“These limitations translate into uncertainty for (re)insurers—uncertainty in pricing, reserving, and capital adequacy. Addressing these constraints has required more than incremental improvement; it has demanded a fundamental rethinking of how severe convective storm hazard, vulnerability, and financial outcomes are modeled,” commented Tom Sabbatelli-Goodyer, Director – Product Management, Moody’s.
Powered by Moody’s Intelligent Risk Platform, the new models possess the ability to deliver unprecedented accuracy and insight through three key features: hazard that reflects reality, vulnerability built for today, and financial modelling that mirrors policy reality.
“The conversation on severe convective storm modeling often stops at hazard. But true resilience requires a model that integrates hazard, vulnerability, and financial precision—supported by transparent validation and scientific credibility. The models achieve this and offer catastrophe modelers a compelling solution that not only overcomes the uncertainties of the past but also unlocks new possibilities for risk insight and decision-making,” Sabbatelli-Goodyer added.
Concluding: “The launch of the Moody’s RMS North America Severe Convective Storm HD Models marks a pivotal moment for the industry. For the first time, (re)insurers will have access to a model that combines scientific rigor, computational power, and real-world calibration to deliver actionable insights at scale.”
No doubt, these new models will be extremely useful to the insurance, reinsurance and insurance-linked securities (ILS) industry, as they will be able to provide more detailed accuracy and stability for reinsurers and ILS investors for capital allocation concerning the rising severe convective storm peril.
