Estimating the impacts of natural hazards on property and building losses — ASN Events
  1. Schedule
  2. Economics of Natural Hazards 1
  3. Estimating the impacts of natural hazards on property and building losses

Estimating the impacts of natural hazards on property and building losses (#9)

Rob van den Honert 1 , Katharine Haynes , Ryan Crompton , Lucinda Coates
  1. Risk Frontiers, North Ryde, NSW, Australia

This research project will include a timeline examination of the historical economic costs of property and building losses due to natural hazards in Australia.

The project will analyse normalised insurance losses, which effectively estimate the insured losses as if past events were to impact present-day society, a process that must be carried out in order to have an ‘apples-versus apples’ comparison of event losses over time. Thus normalisation refers to the process of adjusting historical losses for known societal changes (e.g. numbers of homes, the value of these homes, and improvements in building codes and construction).

At present the only publically available source of natural hazard loss information is the widely-cited 2001 BTE report Economic Costs of Natural Disasters in Australia – Report 103, 2001, which was heavily based upon incorrect insurance loss data, and used an inadequate normalisation methodology. The project will re-examine this work using information up to 2016 contained in:

  • Risk Frontiers’ PerilAUS historical natural hazard database of the incidence (e.g. occurrence, frequency, magnitude, affected locations, etc.) and consequences (property damage and fatalities, etc.) of ten natural hazard categories (consisting of over 6,500 separate events at over 12,000 locations), and

  • The Insurance Council of Australia’s Historical Disaster Statistics, a list based on submissions to the ICA following natural catastrophe events incurring insured costs in excess of $10 million.

This presentation will focus on the planned methodology, particularly the normalisation process.  An analysis of bushfire (1) property and building losses due to bushfire, and (2) frequencies of damaging bushfires, both nationally and for each state and territory, will be presented to illustrate the methodology.   

Future work in this project will include a full analysis of property and building losses due to tropical cyclones, flood, earthquake, tsunami, severe storm and bushfire. The analysis will examine spatial losses due to each peril, and temporal changes in hazard impacts, and will provide a natural priority ranking of natural hazard risks.