Pursuing Simplicity: Turning complex natural catastrophe science into practical simplicity
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*This article summarizes the presentations delivered by Yugo Shinozuka, Senior Underwriter Property & Lead Parametric at Swiss Re International SE, Japan Branch, at AOGS 2025 and JpGU-AGU 2026.
Natural hazards are never simple. Earthquakes, tsunamis, extreme rainfall and floods are complex, dynamic and uncertain. Yet, after a disaster, the needs of businesses and society are clear: quick access to funds, transparent decision-making and practical support for recovery.
Swiss Re International SE, Japan Branch is collaborating with Tohoku University to explore how advanced natural hazard science can be translated into practical financial solutions, particularly through parametric insurance. Unlike traditional insurance, which generally requires detailed loss adjustment, parametric insurance provides payouts based on pre-agreed triggers and pre-agreed payout amounts. These triggers may include seismic intensity, tsunami height, rainfall amount, wind speed or river water level. Once the agreed threshold is met, payment can be made swiftly based on an objective and measurable index.
Simplicity is not the same as being simplistic...and that's where our collaboration with Academia begins.
For tsunami risk, one of the main business challenges is how to anticipate inland inundation depth and potential damage at a specific facility based on limited but reliable observation data, such as tide-gauge measurements.
Pursuing simplicity Figure 1
Through joint research with Tohoku University, Swiss Re is applying Probabilistic Tsunami Risk Assessment, or PTRA, to high-resolution scenario modelling. By analysing many tsunami scenarios, the research quantifies the relationship between tsunami heights observed at tide gauges and inundation depths at specific inland locations. This does not eliminate basis risk entirely, but it helps make that risk more visible, explainable and manageable.
Pursuing simplicity Figure 2
For extreme rainfall and flood risk, the challenge is different. Under a changing climate, rare and severe rainfall events may not be adequately captured by several decades of historical observation data alone. The joint research therefore combines 720 years of large-ensemble climate projection data from d4PDF with high-resolution terrain data and meteorological and hydrological modelling. This enables the construction of catchment-specific rainfall hazard curves, helping to assess events beyond the historical record and to consider simple but credible rainfall triggers for target catchments.
Pursuing simplicity Figure 3
The purpose of this collaboration is not to remove complexity from science. Rather, it is to distill complexity into something clear, transparent and executable. By connecting academic expertise with real-world insurance needs, Swiss Re Corporate Solutions and Tohoku University aim to support solutions that can provide faster liquidity, enhance business continuity and contribute to a more resilient society.
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