Enterprise Risk Management Technology Guide 2023

Moody's Analytics - Scenario Generation Solutions

Type of System

  • Economic / risk scenario generator
  • Portfolio analysis/hedging
  • Stress and scenario testing

Type of platform

  • Cloud
  • Desktop-based
  • Grid
  • Server-based

Other features - does your offering facilitate

  • Curve-fitting
  • Least-squares Monte Carlo
  • NAIC Principle-based reserving
  • Replicating portfolios
  • Solvency II internal model
  • Solvency II standard formula

What are the typical implementation costs?

Moody’s Analytics does not disclose pricing. Our standard pricing structure is based on an annual licence fee based for permitted use, permitted users, number of economies and model choices. Costs for scenario services are determined based on the define project requirements.

How long does your software take to implement on site?

This depends on the client’s requirements, but often clients can be up and running very quickly. For a simple configuration, installation and set-up may only require a few hours. More sophisticated requirements may result in a more complex implementation.

Please name companies that use the system/solution

Uniqa Insurance Group, one of Austria's leading insurers, selected a number of Moody's Analytics solutions in July 2017 for their valuation, components of their internal model, strategic asset allocation, and portfolio optimisation. 

Admiral Group selected the Moody's Analytics Economic Scenario Generator (ESG) in October 2017 for market risk calculation as part of their Solvency II Internal Model, and will also use the ESG for investment modelling and stress and scenario testing, benefitting from the flexibility of the ESG. 

Provinzial NordWest selected Moody’s Analytics modeling technology in June 2018 for actuarial valuations and investment analysis. 

Allianz Suisse selected Moody’s Analytics Economic Scenario Generator in July 2018 to produce regulatory compliant risk-neutral scenarios for the Swiss Solvency Test (SST), and to analyse how model choice and input assumptions can impact Solvency II valuations.

Most recent significant update:

We are engaged with customers on the impact of inflation rates on our stochastic models. In particular, we have delivered stress testing calibrations to different forward looking expected paths of inflation to support firms looking to understand the sensitivities of their key capital metrics.

Faster calibrations delivered on business day 1 of each quarter to support the short timelines insurers are managing in relation to their IFRS 17 reporting requirements.

Enhancements to Climate Pathways uses scenario generation to facilitate customers’ efforts to respond to ORSA and TCFD requirements to quantify the financial impact from climate related physical and transitional risks. The scenarios can also support integration of climate risk into strategic asset allocation (SAA) and investment selection processes.

Continued to enhance our Risk Integrated Credit Scenarios services that provides integrated modelling of ‘market’ and ‘credit’ risk in a multi-asset class framework.

Improvements to the Cloud Burst Service that lets users run the Scenario Generator in the Moody’s Analytics hosted cloud environment.

Enhancements to our market-leading modelling and calibration content.

Planned future enhancements:

Not disclosed.

How does your solution integrate with third-party systems or in-house systems?

Our scenario generation solutions integrate with Moody’s Analytics AXIS™ actuarial modelling system and all major ALM systems. We have grid-compatible architecture that works with grid products from Microsoft and Digipede, which customers license separately from these companies.

What is the key attribute of your product(s) that differentiates it from your competitors?

  • Moody’s Analytics Scenario Generation solutions are compiled from a suite of leading-edge stochastic models, software modules, and services that allow insurers and other financial institutions to undertake a range of risk management activities.
  • Our calibrations are fully validated and documented (including Solvency II calibrations) and delivered on working day 2 of every quarter.
  • Our products are supported by Moody’s Analytics economists who generate house views and assumptions along with detailed documentation.
  • They are change-managed with a comprehensive governance framework to support regulatory applications.
  • We support our clients and transfer knowledge through initial and ongoing training.
  • We offer a dedicated client support web and client support desk.
  • We hold annual user groups and conferences.

What trends are you seeing in terms of customer demand?

We are seeing demand to upgrade modelling capability, modernise and industrialise their processes, to meet strategic business goals, regulatory demands, and delivery times required of IFRS 17, which requires more scenarios in a shorter timeframe. In addition, firms are looking at new products where they need stochastic scenarios for the first time to understand liabilities or asset projections. For example, our Climate Pathway Scenario Service can help insurers embed climate risk into the Own Risk and Solvency Assessment (ORSA).


Moody’s Analytics Scenario Generation Solution suite is a market-leader for stochastic models, software modules, and services.


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