HR: 15:25h
AN: S23C-07    [Abstracts]
TI: Insurance Applications of Active Fault Maps Showing Epistemic Uncertainty
AU: * Woo, G
EM: Gordon.Woo@rms.com
AF: Risk Management Solutions, 30 Monument Street, London, EC3R 8NB United Kingdom
AB: Insurance loss modeling for earthquakes utilizes available maps of active faulting produced by geoscientists. All such maps are subject to uncertainty, arising from lack of knowledge of fault geometry and rupture history. Field work to undertake geological fault investigations drains human and monetary resources, and this inevitably limits the resolution of fault parameters. Some areas are more accessible than others; some may be of greater social or economic importance than others; some areas may be investigated more rapidly or diligently than others; or funding restrictions may have curtailed the extent of the fault mapping program. In contrast with the aleatory uncertainty associated with the inherent variability in the dynamics of earthquake fault rupture, uncertainty associated with lack of knowledge of fault geometry and rupture history is epistemic. The extent of this epistemic uncertainty may vary substantially from one regional or national fault map to another. However aware the local cartographer may be, this uncertainty is generally not conveyed in detail to the international map user. For example, an area may be left blank for a variety of reasons, ranging from lack of sufficient investigation of a fault to lack of convincing evidence of activity. Epistemic uncertainty in fault parameters is of concern in any probabilistic assessment of seismic hazard, not least in insurance earthquake risk applications. A logic-tree framework is appropriate for incorporating epistemic uncertainty. Some insurance contracts cover specific high-value properties or transport infrastructure, and therefore are extremely sensitive to the geometry of active faulting. Alternative Risk Transfer (ART) to the capital markets may also be considered. In order for such insurance or ART contracts to be properly priced, uncertainty should be taken into account. Accordingly, an estimate is needed for the likelihood of surface rupture capable of causing severe damage. Especially where a high deductible is in force, this requires estimation of the epistemic uncertainty on fault geometry and activity. Transport infrastructure insurance is of practical interest in seismic countries. On the North Anatolian Fault in Turkey, there is uncertainty over an unbroken segment between the eastern end of the Dzce Fault and Bolu. This may have ruptured during the 1944 earthquake. Existing hazard maps may simply use a question mark to flag uncertainty. However, a far more informative type of hazard map might express spatial variations in the confidence level associated with a fault map. Through such visual guidance, an insurance risk analyst would be better placed to price earthquake cover, allowing for epistemic uncertainty.
DE: 1873 Uncertainty assessment (3275)
DE: 7212 Earthquake ground motions and engineering seismology
SC: Seismology [S]
MN: Fall Meeting 2005