AIR Worldwide enhances Australian earthquake model

Catastrophe risk modeling firm AIR Worldwide has updated its earthquake model for Australia to provide a "comprehensive and scientifically credible" view of risks.

AIR said 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.

The updated 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.

According to the risk modeller, since Australia is characterised 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 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.

“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 Jayanta Guin, executive vice president and chief research officer of AIR Worldwide.

“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,” he added.