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The potential for the use of model fusion techniques in building and developing catastrophe models
Global economic losses related to natural hazards are large and increasing, peaking at
US$380 billion in 2011 driven by earthquakes in Japan and New Zealand and flooding in Thailand.
Catastrophe models are stochastic event-set based computer models, first created 25 years ago, that
are now vital to risk assessment within the insurance and reinsurance industry. They estimate likely
losses from extreme events, whether natural or man-made. Most catastrophe models limit the level
of user interaction, stereotyped as ‘black boxes’. In this paper we investigate how model fusion
techniques could be used to develop ‘plug and play’ catastrophe models and discuss the impact
of open access modelling on the insurance industry and other stakeholders (e.g. local government)