Catastrophe risk modelling firm AIR Worldwide has updated its assessment of earthquake risk for Australia.

AIR’s model, developed to meet the risk management needs of insurers, has been amended to capture the effects of earthquake-induced ground shaking and liquefaction on risks located in Australia, including Tasmania.

Boston-based AIR says Australia is characterised by low seismic hazard and high levels of uncertainty. The update was prompted by findings in the National Seismic Hazard Model from Geoscience Australia, which challenged established wisdom and “generally decreased the view of seismic hazard significantly” for Australia.

The model’s fault database has been updated based on Geoscience’s fault model and expanded to 391 faults, including a recent fault discovered as a result of the 2018 Lake Muir Earthquake south of Perth.

The model now includes explicit support for new risk types including marine hull, marine cargo and builder’s risk.

“We took a careful and thoughtful approach in order to deliver this update,” AIR Worldwide Chief Research Officer Jayanta Guin said.

“The updated model’s revised view of the seismic hazard and updated vulnerability functions provide a better match to historical losses. These updates allow for AIR to continue to provide a comprehensive and scientifically credible earthquake model for Australia.”

AIR scientists developed a method to convert Australia’s local magnitude (ML) to the more widely used moment magnitude (Mw) scale to create a catalogue that has been “homogenised” to a consistent Mw scale.

New ground motion prediction equations are included and Site Soil Classification Maps updated with higher resolution amplification modelling along the population-dense coastal areas.

AIR also released nine “extreme disaster scenarios” to assist in stress testing and assessing the impact of large loss events.

“While they represent low probability – and in some cases very low probability – scenarios, they are nevertheless scientifically plausible,” the company says.