---
title: "What the model is standing on."
source_url: https://abgalis.com/cascade/october-2026
canonical: https://abgalis.com/cascade/october-2026
description: "The Cascade, October 2026: what the model is standing on. A damage function withdrawn from under a supervisory scenario family, the ESAs on Solvency II capital requirements that capture core risks but not all, four catastrophe houses measuring one half-year, and two instruments that change inputs without changing rules."
publisher: Abgalis Limited
author: Abgalis Research
date_published: 2026-10-15
retrieved: 2026-10-15
content_signal: search=yes, ai-input=yes, ai-train=no
citation: "Abgalis Research, 'What the model is standing on.', Abgalis Limited, https://abgalis.com/cascade/october-2026"
license_note: >-
  May be quoted and cited in AI-generated answers with attribution to the author named
  above and a link to source_url. Not licensed for model training or fine-tuning
  (ai-train=no; Art. 4 reservation, EU Directive 2019/790).
---
Abgalis · The Cascade

# What the model is standing on.

Vol. 1 · No. 4 · October 2026 · 15 pages

A damage function withdrawn from under a supervisory scenario family. The three European Supervisory Authorities writing that Solvency II's capital requirements "capture core risks but not all". Four catastrophe houses measuring one half-year and disagreeing by $42bn on what was lost. And two instruments, dated either side of the turn of the month, that change inputs without changing rules. The framings are ours, not the regulators'.

The academic paper behind the chronic physical-risk damage function in Phase V of the NGFS long-term scenarios was retracted from Nature on 3 December 2025. The NGFS said so the same day, said the short-term scenarios and the Phase IV acute estimates are unaffected, and said a replacement methodology is due at the end of 2026. This brief carries it now because the year in between is the year most firms are running on. On 21 September 2026 the same network published a 2026 Guide for Supervisors on climate and nature-related financial risks.

On 23 September the Joint Committee of the ESAs wrote, of Solvency II, that "Capital requirements capture core risks but not all (e.g. credit & issuer concentration risk)". The same report puts "c. 28% of ceded risks" with non-EEA counterparties, "highly concentrated in the UK, Bermuda and Switzerland". Read from London, that concentration is into us.

Four catastrophe houses have now measured the first half of 2026. They agree within $5bn on what was insured and disagree by $42bn on what was lost; one named event is put at $20bn by one house and $37bn by another. Verisk's modelled benchmark rose $19bn in a year, to $171bn.

Read the issue Download PDF All issues

Published October 2026 · Abgalis Research · verified and source-attributed throughout.

## Get every issue

Published the 1st of each month. No marketing email — the issue, and nothing else.

**You're on the list.** The next Cascade lands in your inbox on the 1st of next month. Unsubscribe in one click at any time.

We use your email only to send The Cascade and occasional update notices. We don't share or sell your details. UK GDPR compliant. Abgalis Limited is registered in England and Wales.

---

**Source:** [https://abgalis.com/cascade/october-2026](https://abgalis.com/cascade/october-2026) · Abgalis Research, published by Abgalis Limited (England and Wales, no. 17247499)

**Cite as:** Abgalis Research, *What the model is standing on.*, Abgalis Limited. https://abgalis.com/cascade/october-2026

**Usage:** citation with attribution permitted; model training not permitted (`ai-train=no`).

**More:** [https://abgalis.com/llms.txt](https://abgalis.com/llms.txt) · full corpus: [https://abgalis.com/llms-full.txt](https://abgalis.com/llms-full.txt)