Maximum loss prediction for earthquake insurance
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Insurance is one of the most important elements of earthquake risk management. In this paper an attempt is presented to formulate a conceptual basis for maximum loss prediction to be used in earthquake insurance policies. Due to the complexity and randomness of the physical phenomena such as damage prediction and seismic hazard a full probabilistic approach combined with well established models is proposed. Modern reliability methods are thereby implemented, which are able to take all influencing uncertainties into consideration. The method is illustrated in an example application.
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