AIR provides catastrophe risk modeling solutions that make individuals, businesses, and society more resilient.
Press Release

BOSTON, Nov. 22, 2016 — Catastrophe modeling firm AIR Worldwide (AIR) today released its “2016 Global Modeled Catastrophe Losses” report, detailing key loss metrics from AIR’s global industry exceedance probability (EP) curve. Based on the report, AIR estimates that the 1% aggregate exceedance probability insured loss (or the 100-year return period loss) from catastrophes worldwide is approximately USD 253 billion, and the global insured average annual loss is about USD 80 billion. The 2016 report bases its global loss metrics on perils and regions currently modeled by AIR, including new models and updates released during 2016, as well as databases of property values for more than 100 countries.

The global aggregate average annual loss (AAL) and exceedance probability loss metrics for 2016 include results from one new model introduced this year (India earthquake) and reflect changes in risk as a result of updated models (U.S. terrorism, U.S. crop hail; U.S. MPCI; Southeast Asia typhoon with expansion to include Guam, Macau, Saipan, and Vietnam; Southeast Asia earthquake with expansion to include Hong Kong, Macau, Vietnam, and Singapore), as well as the latest updates to AIR’s industry exposure databases for the U.S., India, and Southeast Asia.

Average annual insured losses and the metrics from the aggregate insured EP curve—for all regions and perils modeled by AIR—have increased steadily since the first report was published in 2012. This is expected; the rise reflects both increases in the numbers and values of insured properties in areas of high hazard and the inclusion of regions and perils for which new models are now available.

The 2016 report also includes AIR’s presentation of global EP metrics on an insurable basis, where insurable loss metrics include all exposures eligible for insurance coverage assuming standard limits and deductibles, regardless of whether they are actually insured. A large difference between insured and insurable losses may indicate cases where the risk is not fully understood and society is inadequately prepared to respond. For regions and perils covered by existing catastrophe models, this difference presents not only potential growth opportunities for the insurance industry to offer essential protection to vulnerable home and business owners, but a responsibility to act.

The 2016 Global Exceedance Probability report also includes a breakdown of contribution to global AAL by region and peril and key aggregate EP metrics by region. Download the report here:
http://airww.co/GlobalEP16

About AIR Worldwide

AIR Worldwide (AIR) provides catastrophe risk modeling solutions that make individuals, businesses, and society more resilient. AIR founded the catastrophe modeling industry in 1987, and today models the risk from natural catastrophes, terrorism, cyber attacks, and pandemics globally. Insurance, reinsurance, financial, corporate, and government clients rely on AIR’s advanced science, software, and consulting services for catastrophe risk management, insurance-linked securities, site-specific engineering analyses, and agricultural risk management. AIR Worldwide, a Verisk Analytics (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.


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