Earthquake PML : household buildings - Sydney.

Bibliography: p. 40

Cover title

The Newcastle earthquake produced very clear evidence of the inter-relationship between the construction of dwellings and the localised soil conditions in determining the damage ratios in the various affected areas. However, there has been little or no market-wide research to establish what these relationships actually mean in terms of setting PMLs for the major capital cities in Australia where the insured values are considerably higher than in Newcastle. This study is deliberately focussed on the buildings component as it is estimated that some 45% to 50% of the total nett retained sums insured of the Australian insurance market relates to this coverage. It also represents a homogeneous sample unlike commercial risks which vary widely from insurer to insurer. The current state of the catastrophe reinsurance market is ample evidence of the necessity for insurers, and their reinsurers, to have a better understanding of the risks they are assuming. This report on Sydney is an attempt to add to the accumulated knowledge of the insurance and reinsurance market