Silfio Methodology

Silfio uses advanced statistical techniques and Artificial Intelligence to give a transparent data-driven view of the financial risk institutions and investors face from geopolitical conflict.

Step 1

Event

Conflict Generation

Using the current geopolitical climate, Artificial Intelligence adjusts the model base-rate probability of a country facing conflict within the next 12 months, to give a forward looking view of the geopolitical climate.

Step 2

Hazard

Conflict Severity Generation

Given a conflict event and a country's features, the model estimates the severity of the resulting conflict in terms of physical intensity and economic disruption.

Step 3A

Inventory

Measuring Likelihood of Property Impact

Using the properties' coordinates, the probability of a hit on a property is estimated by mapping against proven hotspots and area features to determine which locations in the country are most likely targeted.

Step 3B

Investment

Measuring Hit on Financial Holdings

Given the intensity of the conflict and the country's economic environment, Silfio estimates financial loss on exposed holdings using evidence from previous geopolitical and macroeconomic shocks. The analysis assesses likely outcomes across market risk, credit risk, currency risk, and default risk.

Step 4

Vulnerability

Mapping Damage to Property

Using a property's features, the damage to a property is estimated given it has been hit.

Step 5

Financial

Determining Financial Loss

The damages are then consolidated and the effect of any insurance (or reinsurance) is taken into account to determine net loss.