Boston’s AIR Worldwide Corporation announced that its Extratropical Cyclone Model for Europe has been incorporated into CLASIC/2, AIR’s detailed risk modeling software system.
“The model, which incorporates the most complete and consistent set of atmospheric data available, is based on Numerical Weather Prediction (NWP), the methodology used by major meteorological agencies around the world,” said the bulletin. It also incorporates local engineering expertise to better determine the impact of wind on structures in the 12 European countries covered, and will enable European insurers and reinsurers, for the first time, to estimate windstorm losses at the individual risk and policy level utilizing risk modeling techniques based on the actual physics of the atmosphere.
AIR explained that “Atmospheric conditions for extratropical cyclones tend to be complex, with multiple high pressure ridges, low pressure troughs, fronts, and strong jet stream winds, all interacting to produce damaging winds. NWP enables AIR’s model to capture these complex atmospheric conditions and accurately depict the time-dependent, three-dimensional structure of the winds associated with extratropical cyclones. In fact, it is the vertical component of the model that enables the simulation of phenomena such as ‘gravity waves’ and ‘sting jets’ that result in the strongest wind gusts at the surface and typically cause the most serious damage.
“The damage estimation component of the AIR model is based on extensive research by AIR’s engineering team using onsite analysis combined with loss data from actual storms. Variations in historical storm experience have prompted different construction techniques and building practices across the continent. AIR engineers have taken these variations into account by developing separate damage functions for each modeled country and for different regions within countries, where appropriate.”
AIR senior vice president Uday Virkud noted, “Only by using NWP and region-specific damage functions can catastrophe modelers accurately estimate losses from extratropical cyclones. Furthermore, because the most intense winds in these complex storms are typically highly localized, as was seen in storms such as Lothar and Martin [two very severe windstorms which struck Western Europe in Dec. 1999], it is important to model insurance portfolios at the highest resolution possible. CLASIC/2, will accept detailed property and policy data, providing the most accurate view of the loss potential.”
The bulletin indicated that “reinsurers have been using AIR’s NWP-based European windstorm model to assess risk portfolios since 2000 in CATRADER. Insurers, reinsurers and intermediaries can now use the model within CLASIC/2 to estimate loss potential down to an individual risk. Furthermore, exposures can be modeled across borders for select countries, or for all 12 countries included in the model. Model output can be used for pricing, risk selection, portfolio optimization, and reinsurance buying.”
Was this article valuable?
Here are more articles you may enjoy.