Verisk Unveils 12-Month War Forecast Models as Conflict Costs Near $22 Trillion
Updated
Updated · Fortune · Jun 14
Verisk Unveils 12-Month War Forecast Models as Conflict Costs Near $22 Trillion
3 articles · Updated · Fortune · Jun 14
Summary
Verisk released two new tools to clients in late May — a Predictive War Index and a Geopolitical Relations Index — aimed at helping banks, insurers and investors price military conflict risk.
Back-testing showed the war model would have assigned Iran a 66% chance of war 1 1/2 months before fighting began, using machine-learning trained on political, economic and social data from 1995-2022.
Wall Street is seeking new approaches because traditional historical models break down when sanctions, blockades or shipping disruptions reshape markets rather than produce normal price swings, Citi and Morgan Stanley say.
The pressure is growing: countries engaged in external conflicts have nearly doubled since 2008 to just over 100, while violence now carries an almost $22 trillion economic toll — more than 10% of global GDP.
That shift is already hitting finance and insurance, with marine war-risk premiums in the Strait of Hormuz rising to as much as 1% per voyage after the Iran war and companies increasingly treating war as a core insurable threat.
Could AI war predictions become self-fulfilling prophecies by triggering capital flight from at-risk nations?
As conflict disrupts global trade, which Western energy producers are poised to profit most from the supply crisis?
How can regulators oversee 'black box' risk models to stop them from making entire countries uninvestable?
The Rise of Predictive War Risk Models: AI-Driven Analytics Transforming Insurance and Finance Amid Geopolitical Volatility (2026)
Overview
As of June 2026, the world faces accelerating geopolitical volatility, making advanced predictive war risk models urgently necessary. This volatility has become normal and is intensifying, with escalating risk drivers breaching global safeguards and causing more frequent geopolitical shocks. The dramatic rise in internationalized intrastate conflicts since 2010 shows a major shift in the nature and scale of global conflict. Localized disputes now fuel broader regional instability, driven by political, economic, and military factors, as well as refugee flows. These changes highlight the need for new tools to anticipate and manage growing global risks.