Modeling Fundamentals

Trending historical losses is not a new concept, but Verisk's approach has an advantage over other normalization methods.

The 2020 update to the AIR Earthquake Model for Australia provided an opportunity to add support for new risk types and re-evaluate the modeled vulnerability for property in Australia. Cavity double brick masonry and masonry veneer constructions, which constitute the majority of residential buildings in Australia, are used as examples to illustrate this update in light of newly available data from Australia and New Zealand.

In this article Harry White, CEEM, revisits our 2016 primer on the catastrophe bond issuance process to reflect changes in the cat bond market landscape and EES offerings

Touchstone^® provides you with an option to modify ground-up losses based on a set of filter criteria, such as event, geography, exposure characteristics, and more.

The Advanced Loss Modification (ALM) module in Touchstone Re™, the successor to and next generation of EMM in CATRADER™, enables companies to analyze global reinsurance treaties beyond the scope covered by AIR’s traditional suite of models and offers clients the flexibility to modify modeled losses and perform advanced sensitivity testing, all within the same reinsurance platform they are using today.

This article focuses primarily on damage surveys conducted in the aftermath of U.S. hurricanes and addresses how and why we conduct them. As we update our U.S. hurricane model—a tool that helps quantify the risk—we uncover more questions that are typically answered only after studying another event.

Kinematic modeling techniques use a physical approach to understanding earthquake risk, effectively augmenting the sparse available historical data. AIR Seismologist Dr. Bingming Shen-Tu explains what kinematic modeling is and provides real-world examples in South America, China, Japan, and New Zealand of how effective it is.

In this article, Dr. Jayanta Guin, AIR Chief Research Officer, introduces some key concepts and answers the fundamental questions: What is uncertainty, where does it come from, and how is it treated in models?

Explaining the inner workings of one of the most critical (and difficult to develop) components of a catastrophe model—its damage functions.

This article is an update of an article originally published in 2009 in which Dr. Guin discusses why it is so important for scientists and engineers at AIR to determine whether competing approaches are credible and how much weight to assign to emerging science before a consensus is reached.

This article outlines some ways in which users of AIR’s Touchstone platform can gain new insights into the uncertainty in their modeled loss estimates, create a framework for testing the sensitivity of results, and make better informed business decisions.

This article explains the fundamentals behind the calculation of average annual loss (AAL). An upcoming article will address some common misperceptions and frequently asked questions.