A novel strategy to determine the insurance and risk control plan for natural disaster risk management

This study presents an extended framework for the analysis of economic effects of natural disaster risk management. It also attempts to define and evaluate the optimal insurance arrangements. A model, the economic utility constrained-maximization model, is proposed. The purpose of this study is to establish a strategy for determining an insurance and risk control plan in which consideration is given to balancing the economic effects (e.g., decrease in costs due to damage) by disaster mitigation. Furthermore, these values are compared with risk control actions for purposes of prioritization, to provide data to help evaluate the benefit of each risk control action. Disaster insurance policy premiums in contrast are based on actuarial data taken from situations in which risk control measures are not employed. This can make such contracts unfair to responsible enterprise managers who must take risk control measures. This represents an unfair aspect of insurance policies. Enterprise managers should be able to determine the optimum arrangement between natural disaster risk control and insurance given their budget limitations. The optimal strategies aim at the best applicability and balance between risk control and insurance capability for the enterprise manager. Risk control measures can generate several risk control options for enterprise managers. Premium discounts by insurers are given in this model.     

Hazard management and risk design by optimal statistical analysis

Elicitation methods are used in decision making with respect to risk hazards to allow a researcher to infer the subjective utilities of outcomes from the observed preferences of an individual. A questionnaire method is presented, in this study, which takes into account the inevitable distortion of preferences by random errors and minimizes the effect of such errors. Under mild assumptions, the method for eliciting the utilities of many outcomes is a three-stage procedure. First, the questionnaire is utilized to elicit responses from which a subjective score is defined. Second, individual risk factors are discussed. Finally, the regression model presents individual risk preferences given the overall organizational risk culture, risk management policy, risk identification, and risk analysis. This paper addresses how company managers face risk and their tolerance of risk with respect to risk management.     

Risk and uncertainty analysis in the planning stages of a risk decision-making process

Natural disaster risk, a long-time concern in the insurance industry, is increasingly recognized as a present danger in the business strategies of risk control and enterprise management agencies. Floods and earthquakes can cause massive loss of life and infrastructure, resulting in business interruption and heavy casualties. Many of the short-term developmental strategies employed throughout the world have only served to exacerbate the impact of natural disasters. Therefore, this study presents a review of formal methods that are commonly used in risk and uncertainty analysis in planning and concludes with a critical assessment of the advantages and disadvantages of the different priority setting methods. Our focus is a preliminary proposal for developing an efficient probabilistic approach to facilitate design optimization that involves probabilistic constraints.     

A probabilistic approach for earthquake risk assessment based on an engineering insurance portfolio

This paper presents the construction classification of the existing engineering covers in Taiwan. The exposure profile and variable vulnerability during different construction phases are established for some kinds of classes of construction. Finally, we present a method and framework to estimate the probable maximum loss of engineering insurance portfolio during an earthquake with consideration of the dynamic nature of structural changes and exposure values during a construction project.     

Earthquake risk assessment and optimal risk management strategies for Hi-Tech Fabs in Taiwan

In this paper, we build an event-based seismic hazard assessment and financial analysis model for Hi-Tech Fabs in Taiwan. As we know, the low occurrence rate, tremendous loss and high uncertainty are characteristics of earthquake disasters. To handle the above issues, the model integrates knowledge from many fields including earth science, seismology, geology, risk management, structural engineering, the insurance profession, financial engineering and facility management. The portfolio of data from the site survey indicates that the model can be used to calculate the event losses (including buildings, contents and business interruption losses); furthermore the average annual loss and loss exceeding probabilities also can be calculated. The total earthquake risk cost, which includes earthquake insurance premiums, average annual retained loss and equivalent annual retrofit cost, is defined as an indicator for selection of optimal risk management strategies.     

Application of a feature-based approach to debris flow detection by numerical simulation

A debris flow is a serious natural disaster which can occur anywhere whether in a valley or on a mountain slope, destroying everything it passes through. Debris flows can occur suddenly and cause residents in the path to suffer casualties and property loss. An early warning system is necessary to reduce the damage in order to protect human life and personal property. However, most debris flow detection systems, like wireless sensors, satellite images and radar, are not suitable for general public use. Vision surveillance systems are generally erected in Taiwan as public devices for security. Therefore, we propose a novel debris early warning system that uses a computer vision technique and build a simulation environment to prove the feasibility.     

The construction of a high-resolution visual monitoring for hazard analysis

High rates of urbanization, environmental degradation, and industrial development in disaster-prone areas have all served to increase the extent of damage following catastrophes. In this paper, we present a novel framework for exploiting multi-resolution dual cameras, including a wide-angle camera and a speed dome camera, to construct a wide-angle, multi-layered, high-resolution visual monitoring system for hazard assessment. Our two-part camera system requires calibration of the correspondence between the detailed and overview image captured by the speed dome camera and wide-angle fixed camera, respectively. In-factory calibration is carried out using white–black patterns for speed dome turning and multi-layered calibration. The results are displayed as wide-angle, multi-layered, high-resolution images which are built up by the speed dome camera.     

An integrated flood risk assessment model for property insurance industry in Taiwan

Taiwan is located in an area affected by Northwest Pacific typhoons, which are also one of the most important sources of rainfall to the island. Unfortunately, the abundant rainfall brought by typhoons frequently produces hazards. In recent years, typhoons and floods have caused serious damage, especially Typhoon Morakot in 2009. In this study, a probabilistic model is developed based on historical events which can be used to assess flood risk in Taiwan. There are 4 separate modules in this model, including a rainfall event module, a hydraulic module, a vulnerability module, and a financial loss module. Local data obtained from the Taiwan government are used to construct this model. Historical rainfall data for typhoon and flood events that have occurred since 1960, obtained from the Central Weather Bureau, are used for computing the maximum daily rainfall for each basin. In addition, the latest flood maps from the Water Resources Agency are collected to assess the probable inundation depth. A case study using the local data is carried out. Assessment is made to predict possible economic loss from different financial perspectives such as the total loss, insured loss, and loss exceeding probabilities. The assessment results can be used as a reference for making effective flood risk management strategies in Taiwan.