AIR Worldwide Corporation (AIR) has been selected to present its approach to terrorism risk modeling at a conference sponsored by the Department of Homeland Security.
AIR will explain how the insurance industry and government organizations are using catastrophe risk models to manage terrorism risk. The conference, which is being held April 27-28 in Boston, is titled “Working Together: Research & Development Partnerships in Homeland Security.”
The Department of Homeland Security is bringing together more than 500 research scientists and engineers working in government, the private sector, and the academic community to present innovative work to make the nation safer. AIR is the only participant to focus on how the insurance industry is benefiting from risk modeling.
“AIR introduced the first terrorism risk model to the insurance industry in September 2002 in response to industry needs after the terrorist attacks on September 11, 2001,” said Jack Seaquist, AIR’s terrorism model product manager and representative at the conference. “Now, a variety of corporations and government agencies rely on AIR’s terrorism modeling tools and extensive database of potential terrorist targets to estimate the human and financial impact from terrorist attacks.”
Seaquist will explain how insurance companies use AIR’s model to manage terrorism risk by employing a variety of techniques including exposure accumulation analyses, target landmark risk analyses, “what-if” scenarios, and probabilistic portfolio loss analyses.
He will also discuss how AIR’s model has been used to develop ISO’s terrorism advisory loss costs that are used by many insurance companies to underwrite the risk.
The current debate on whether to extend TRIA–the Terrorism Risk Insurance Act that was signed into law by Congress in 2002 and is currently due to expire at the end of this year–has focused additional attention on this risk.
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