Risk Frontiers’ new earthquake model shows reduced losses for Australia

Risk Frontiers have announced today the imminent release of their new probabilistic earthquake loss model for Australia, QuakeAUS 6.0. The updated model, developed by Dr Valentina Koschatzky with input from Risk Frontiers’ Chief Geoscientist, Dr Paul Somerville, incorporates the latest data from Geoscience Australia’s recent revision of the Australian Earthquake Catalogue, which has more than halved the rate of earthquakes exceeding 4.5 in magnitude.

The updated Risk Frontiers model incorporates new earthquake source and active fault models. The active fault model is based on geologically identified rare and large prehistorical events that are not present in the short historical record of earthquakes in Australia. The model also includes important updates in the exposure data and in soil classification and amplification.

Dr Paul Somerville, Risk Frontiers’ Chief Geoscientist said:

“Compared with the previous version of Risk Frontiers’ QuakeAUS model, losses have generally decreased across the country (average annual loss is 80% and the 200-year return period loss is 63% of former values on an indicative national portfolio) due to the update in the historical catalogue. This effect is partly mitigated at longer return periods in the regions where active faults have now been modelled.

Changes in losses are not uniform spatially or temporally. Sydney, for example, shows a drastic reduction in losses at every return period, while the losses for Melbourne show a slight increment. In other areas such as Adelaide the losses are lower than in the previous model for short return periods, but that trend is reversed for return periods greater than 1,000 years”.

Risk Frontiers’ General Manager, Dr Ryan Crompton said:

“The release of this updated model demonstrates our commitment to deliver world class research on Australian natural hazard risks to the domestic and international insurance industry.

“We live and work here in Australia and actively participate in research and development in the fields of earthquake hazards and earthquake engineering through participation in the Australian Earthquake Engineering Society, of which Dr Paul Somerville is Past President, and in the Science Advisory Panel’s review of Geoscience Australia’s National Seismic Hazard Assessment. This local expertise means we are ideally placed to bring leading edge knowledge about local earthquake risk to the insurance and reinsurance industries”.

For media enquiries regarding the release of the new earthquake model please contact Andrew Gissing on andrew.gissing@riskfrontiers.com.