EQECAT releases Japan quake model

EQECAT has released an earthquake model for catastrophic risk that uses three-dimensional representation of seismic source geometry to capture Japan’s unique seismic settings.

Incorporated into EQECAT’s global multi-peril platform, the Japan model offers region-specific innovations in both hazard and vulnerability. Key aspects include region-specific hazard definition, time-dependent recurrence rates, model validation/expert review, rational approach to uncertainty, lines of business, perils covered, coverage types and region-specific vulnerability curves.

The full suite of vulnerability curves used include those developed uniquely for structures with seismic-protection systems, and for region-specific construction practices such as the use of steel columns embedded in concrete, notes a statement from EQECAT.

Risk can be differentiated by detailed structural characteristics, including configuration of walls, roof and connections, as captured by secondary structure modifiers.

Vulnerability is also calibrated to claims from the Kobe (1995), Tottori (2000), and Geiyo (2001) events, differentiated by location, age, structure type and line of business. Modeled lines include residential, commercial, industrial and personal accident.

Beyond calculating losses from ground shaking, the model covers fire following earthquakes, sprinkler leakage that leads to water damage to contents and personal accident.

All payout rules used in the Japanese earthquake insurance market are modeled. The Tohoku earthquake last year, the fourth largest, produced estimated economic losses exceeding $200 billion.