As of April 15, 2007, Karen Clark will step down as president and CEO of AIR Worldwide Inc., the Boston-based modeling vendor. She's not planning a long vacation.
"A lot of people think I'm retiring or something, but that's actually not the case," she said. "The knowledge and expertise I built up over 20 years is not just going to waste away."
At the company she founded in 1987, she will take an advisory role as vice chairman of AIR's board. For the insurance industry as a whole, she will become an independent expert and model advocate.
"I'm thinking of extending my role to some of the bigger issues out there," she said.
One such issue is the lack of data standards among the different modeling firms. Currently, insurers are using versions from multiple modeling firms and need to convert their portfolio data into each firm's format--an unproductive, expensive and possibly error-prone process. Clark will work toward a universal format.
Another issue she plans to tackle is the way the insurance industry's senior management views models. The issue is how they're "still not comfortable" with models, she said.
"I'm going to continue to advocate and explain the models to insurance buyers, sellers, legislators and regulators as needed," Clark said.
As for AIR, she said the company will be in good hands and in a strong industry position. S. Ming Lee, the current executive vice president, will replace Clark as president and CEO. He and the rest of AIR management, she said, will continue with her vision, which came to her in the mid-1980s while she worked in research and development for an insurer. The insurer asked R&D to devise a way to estimate its hurricane exposure along the East Coast. With a background in financial models from a graduate program in economics, Clark saw the future.
"The company I worked for was much more forward-thinking than other companies," she says. "Most insurance companies back then weren't even thinking about catastrophes."
April 1, 2007
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