Summit, N.J.-based risk modeling firm Baseline ManagementCompany Inc. announced today it has a new set of catastrophe modelsfor hurricanes and earthquakes accessed as a service through thecompany's hosted Web-based platform.

Baseline said the products were developed with Applied ResearchAssociates Inc., Albuquerque (ARA) and URS Corp., San Francisco(URS), and incorporate extensively tested concepts and utilizepeer-reviewed science and engineering.

Craig Ott, Baseline president and chief executive officer, saidthe Baseline United States Hurricane and Earthquake Models onlineplatform has been designed as a “transformational innovation forthe catastrophe modeling market.”

For more than a decade, he said, “the insurance and reinsuranceindustries have relied mostly on the models of three cat modelingfirms. With this launch, we offer a uniquely collaborative approachto catastrophe modeling, enabled by state-of-the-art computingtechnology, which specifically addresses many of the concernsshared by users.

“These client issues include the desire for greater transparencyto understand variation in model outputs, which in turn supportsbetter decision-making about strategic pricing, risk management andrisk transfer strategies.”

Baseline said its hurricane model integrates the hazard andvulnerability components of the ARA firm's HURLOSS U.S. Hurricanemodel, which has been approved for rate-making by the FloridaCommission on Hurricane Loss Projection Methodology every yearsince 2000.

The company said HURLOSS has also been used for mitigationanalysis and insurance rate differential modeling in Florida since2001.

Baseline said its earthquake model leverages URS's expertise inbuilding codes and earthquake vulnerabilities, modelingsite-specific building damage using URS's CODA (Code-OrientedDamage Assessment) methodology.

Lawrence Twisdale, ARA executive vice president and chieftechnical officer, said, “We have used our HURLOSS hurricane modelfor research and consulting services since 1998. The opportunity ofcollaborating with Baseline to bring the model to market on theirinnovative platform has provided a significant step forward for ourwind engineering business.”

William Graf, URS Corp. earthquake risk manager, said, “TheBaseline platform provided the perfect fit for the URSCode-Oriented Damage Assessment earthquake vulnerability model,which adapts building vulnerability to the building code design foreach location and year of construction.”

Baseline said its models differ from other catastrophe models ina number of fundamental ways:

o A collaborative partnership approach that allows for theincorporation of all credible alternatives for hazard catalogs,vulnerability functions and loss models into the Baseline system toprovide users with more robust tools.

o Its Platform as a Service Model (PAAS) means users only needan Internet connection to logon to the Baseline Risk Platform.There is no system to integrate or software to install andmaintain, and the platform's architecture and cloud computingcapabilities support large event sets (100,000 years of discreteevents) and reduced processing times allowing more frequent,real-time portfolio reviews while eliminating the need forshort-cuts that can skew results.

o Hazard, vulnerability and insurance/reinsurance modelcomponents are designed as independent objects or “stand-alone”modules that can operate independently from one another but also becombined to provide alternative end-to-end risk models enablingeasy introduction of alternative views on hazard–providing users afunctionality allowing analysis of the sensitivity of theirportfolios to different views on risk. It also permits easy modelupdate and new model introduction.

o The Baseline platform provides tools for extensivevisualization of results through maps, satellite imaging,analytical graphics and exportable tables and incorporates searchtools enabling users to explore both exposure and loss in greatdetail.

o Models are based on the most credible scientific andengineering data available to provide reliable information aboutthe structure and integrity of insured risks and how these riskswould respond under a vast range of conditions.

Baseline said with its partners it has also developed TheBaseline United States Industry Exposure Database, cataloginginsured values and building stock for every U.S. ZIP code.

The firm said it would provide more information about itsproducts at the Reinsurance Association of America's four-dayCatastrophe Modeling Conference, which kicks off today in Tampa,Florida.