Earthquake Set 1

Question	Answer
3 important actions an insurer should do concerning its earthquake exposure	1. Measure 2. Monitor 3. Limit according to a prudent risk appetite and risk tolerance
3 technique to manage the risk	1. Avoidance 2. Risk Transfer 3. Limit
Why is important to have comprehensive policies and procedures	1. Complexities of earthquake exposure risk management 2. Potential high severity losses 3. Difficult to mitigate the risks post-event 4. High public profile
Factors that affect Earthquake Exposure Risk Management:	1. size; 2. ownership structure; 3. nature, 4. scope and complexity of operations; 5. corporate strategy; 6. risk profile.
Define PML	Threshold dollar value of losses beyond which losses caused by a major earthquake are unlikely. Probabilistic models: PML is return period loss, which is defined as the dollar level of loss expected to be exceeded once in every X years.

Resource summary

	Created by Genevieve Gagnon over 5 years ago