NU Online News Service, May 17, 2:23 p.m. EDT--Catastrophe-modeling firm AIR Worldwide Corporation said it has enhanced its catastrophe-risk modeling system, CLASIC/2, to assist insurance companies to prepare for the risk of multiple hurricanes in a single season.
The Boston-based firm also said its CAT-risk modeling system now allows insurers to examine annual hurricane deductibles as well as changing repair costs that can be exacerbated by the occurrence of multiple catastrophe events.
"The 2004 hurricane season highlighted issues that need to be more effectively addressed by insurers managing catastrophe risk," said AIR's senior vice president Uday Virkud.
Since last year's unprecedented hurricane season, the Florida legislature enacted a new law requiring insurers to offer policyholders an annual hurricane deductible. AIR said its CLASIC/2 CAT model can estimate losses based either on an annual or per occurrence deductible.
The model also has added a "demand surge factor" in estimating insured losses, to account for surges in repair costs when an area is hit by multiple storms. CLASIC/2 also includes AIR's workers' compensation model for both earthquake and terrorism, which includes updated claims costs and benefit levels.
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