Worldwide risk and catastrophe modeling firm Eqecat is preparing to release three major revisions to its Worldcatenterprise 3.16 platform. The firm will be updating its existing North Atlantic hurricane, Canadian earthquake and Asian typhoon models. Eqecat is one of many companies in the catastrophe modeling industry that have been making revision to their models recently. The upheaval will have a somewhat dramatic effect on insurance companies and their rates, as these companies rely heavily on risk models to calculate the cost of coverage. The updates will make Eqecat’s catastrophe models more accurate overall.
Eqecat will be drawing upon recent catastrophic events and new surveys conducted by national organizations to more accurately measure risk. Accuracy is a major factor in modeling risk. If insurance companies cannot rely upon models, they will be unable to determine the appropriate cost of coverage and will end up either charging too much for insurance or far too little.
For hurricanes, the firm is taking into account the effect hurricanes have when making landfall, particularly the occurrence of flooding. The firm has been examining how hurricanes behave upon making landfall. Given the recent impact of floods in the southern U.S., there is greater concern surrounding the issue and how hurricanes will contribute to it.
Eqecat is incorporating the latest Canadian Geological Survey to update its model for earthquakes in the region. The new model will take into account tectonic movement and the severity of seismic activity. Eqecat’s Asian Typhoon model will also draw upon surveys conducted in regions exposed to the Pacific.
The overall updates are meant to draw attention to the secondary effects of natural disasters, such as flooding and fires. Insurance companies have been struggling under the weight of such causes recently and Eqecat’s updated models may prove to help insurers prepare themselves for the future.