A forest fire, an episode of hail or a flood… the impacts of natural disasters are increasingly costly for companies. In France alone, insurers paid out a total of 3.28 billion euros in 2020 to repair the damage, according to France Assureurs. The start-up Descartes Underwriting saw it as a market opportunity which it seized three years ago by launching a risk modeling solution which it then offers to companies via brokers. After a strong start, she completed a financing of $120 million taken by Highland Europe.
With this lifting, the young tricolor shoot wants to strengthen its geographical footprint in the United States where it already officiates in a handful of states, details Tanguy Touffut, co-founder and president: “We are going to open in new states, but also in Hong Kong to support our Asian growth and in Madrid to drive Latin American activities. 150 people should thus join Descartes Underwriting during this year, in particular researchers to refine its prediction tool.
A dozen doctoral students specializing in the climate
Because it is on risk modeling that the company wants to stand out, then making reimbursement automatic in the event of a climatic disaster – when it takes on average a year and a half to obtain compensation, with more litigation than on d other slots. “You have to understand the nature of these disasters to model well,” explains the president of the start-up. The way in which drought, soil humidity, temperatures and wind combine in a fire like the gigantic one that took place, for example, last summer in Canada. »
With around ten doctoral students specializing in these issues, the company also wants to evangelize a market on these issues, according to Tanguy Touffut: “We want to share certain information to show that these risks occur in geographical areas which may be wrongly considered to be protected . »
“Climate risk appears to be a major concern for insurers, analyzes Olivier Arroua, partner at the consulting firm Selenis. On a planetary scale, climatic claims are less numerous but cause much greater financial damage due to the concentration of wealth, particularly in high-risk areas, which explains the explosion in claims costs. »
Very high risks
Few entrepreneurs venture into this field. The in-depth knowledge of the workings of insurance and the still very high risk do not allow new players to find a place with the major insurance groups. In 2021, however, Descartes Underwriting has passed the 50 million mark in bonuses distributedfrom which the company takes a percentage that it does not specify.
“We are no longer tiny, but still small, concedes the leader. Our objective is to reach 500 million premiums within three to five years. Enough to give companies time to take full measure of the climate risks they incur.