Boston, July 27, 2020 (GLOBE NEWSWIRE) — Catastrophe risk modeling firm AIR Worldwide (AIR) announced the release of its updated Earthquake Model for Australia. These updates were prompted by findings in the National Seismic Hazard Model from Geoscience Australia (GA), which challenged established conceptions of Australia’s seismic hazard and generally decreased the view of seismic hazard significantly. AIR’s updated fully stochastic, event-based earthquake model serves to capture the effects of earthquake-induced ground shaking and liquefaction on risks located in continental Australia and the island of Tasmania. AIR Worldwide is a Verisk (Nasdaq:VRSK) business.
“This model has been developed to meet the wide spectrum of earthquake risk management needs of the insurance industry and we took a careful and thoughtful approach in order to deliver this update,” said Dr. Jayanta Guin, executive vice president and chief research officer, AIR Worldwide.
The AIR model has incorporated the changes from the updated National Seismic Hazard Model, but this new release of the model also includes many other significant enhancements. Since Australia is characterized by low seismic hazard and high levels of uncertainty in our understanding of risk, having a robust historical catalog is critical for this model. AIR has independently developed a historical catalog that incorporates GA’s 2018 historical catalog as well as additional events from global sources, which has expanded the length of the catalog to the end of 2018. To accomplish this, AIR scientists developed a method to convert Australia’s local magnitude (ML) to the more widely used moment magnitude (Mw) scale to create a catalog that has been homogenized to a consistent Mw scale.
The model’s fault database has been updated based on GA’s updated 2018 fault model and expanded to 391 faults, including a recent fault discovered as a result of the 2018 Lake Muir Earthquake. The latest ground motion prediction equations (GMPEs) are included to better capture the epistemic uncertainty inherent in estimating ground motions in tectonically stable regions. Updated Site Soil Classification Maps offer higher resolution amplification modeling along the coastal areas where the majority of the population resides. The vulnerability framework now uses intensity-based damage functions and has been expanded to include explicit support for new risk types including marine hull, marine cargo, and builder’s risk.
“The updated model’s revised view of the seismic hazard and updated vulnerability functions provide a better match to historical losses. These updates allow for AIR to continue to provide a comprehensive and scientifically credible earthquake model for Australia,” noted Dr. Guin.
As a supplement to this model, AIR is releasing nine Extreme Disaster Scenarios (EDS). EDS’ are meant to provide clients with additional scenarios in light of the uncertainty, to assist in stress testing and assessing the impact of large loss events. While they represent low probability—and in some cases very low probability—scenarios, they are nevertheless scientifically plausible.
The AIR Earthquake Model for Australia is available in the 2020 releases of Touchstone® and Touchstone Re catastrophe risk management systems.
About AIR Worldwide
AIR Worldwide (AIR) provides risk modeling solutions that make individuals, businesses, and society more resilient to extreme events. In 1987, AIR Worldwide founded the catastrophe modeling industry and today models the risk from natural catastrophes, terrorism, pandemics, casualty catastrophes, and cyber incidents. Insurance, reinsurance, financial, corporate, and government clients rely on AIR’s advanced science, software, and consulting services for catastrophe risk management, insurance-linked securities, longevity modeling, site-specific engineering analyses, and agricultural risk management. AIR Worldwide, a Verisk (Nasdaq:VRSK) business, is headquartered in Boston, with additional offices in North America, Europe, and Asia. For more information, please visit www.air-worldwide.com. For more information about Verisk, a leading data analytics provider serving customers in insurance, energy and specialized markets, and financial services, please visit www.verisk.com
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