Submission to the Queensland Floods Commission of Inquiryriskfrontiers.com/pdf/Risk Frontiers...

Submission

to the

Queensland Floods Commission of Inquiry

.

by

Risk Frontiers

Macquarie University

March 2011

Submission to the Queensland Floods Commission of Inquiry by Risk Frontiers, Macquarie University

Submission Summary

Risk Frontiers welcomes the opportunity to make a submission to the Queensland Floods

Commission of Inquiry. This submission is in line with Risk Frontiers’ vision, which is to build safer

communities through a better understanding of natural perils and their consequences.

SUBMISSION SUMMARY

• Reluctance on the part of some councils in Queensland to make available flood

modelling information is contributing to a reluctance on the part of some insurers to

offer riverine flood cover as they are unable to price this risk.

• The cost of natural disasters worldwide is increasing due to rapid growth in population

and wealth in exposed locations. This is particularly true of south east Queensland.

• If we truly want to reduce our vulnerability to future natural disasters in the short and

long term, then policies should be directed towards helping communities adapt to the

more extreme expressions of climate, whatever their cause.

• The canonical 1-in-100 year event (i.e. the event with a 1% annual likelihood of being

exceeded) that has become enshrined in land use planning policies should be viewed as

only one manifestation of a spectrum of possible flood levels.

• Better risk-informed land use planning decisions can reduce the impacts (loss of life,

property and economic capital) from natural disasters such as the 2011 Brisbane floods.

Specifically, we must stop encouraging dangerous property development on the

floodplain.

• Without explicitly commenting on the operation of the Wivenhoe Dam in respect to this

disaster, Risk Frontiers has considerable expertise in stochastic modelling and we note

that forecast uncertainty (that may result in significant overestimation or

underestimation of rainfall in catchments) and thus uncertain inflows to the dam needs

to be considered in operational decision-making. The current system of decision-making

as we understand it appears inflexible and rules-based, a practice that can be dangerous

in dynamically changing situations.


Table of Contents

Table of Contents

Table of Contents .................................................................................................................................... 1

About Risk Frontiers ................................................................................................................................ 1

Introduction ............................................................................................................................................ 2

Data Constraints on the Provision of Flood Insurance ........................................................................... 3

The Rising Cost of Natural Disasters ....................................................................................................... 6

Insured Losses – What Would They Cost Today? ................................................................................... 8

The Importance of Risk-informed Land Use Planning in Reducing Disaster Losses ............................. 11

Manual of Operational Decisions for Wivenhoe Dam .......................................................................... 12

Flood Warnings ..................................................................................................................................... 14

References ............................................................................................................................................ 16

Curricula Vitae ....................................................................................................................................... 18


Page 1

About Risk Frontiers

Risk Frontiers is a world leader in quantitative natural hazards risk assessment and risk management.

Based at Sydney's Macquarie University, Risk Frontiers is a not-for-profit research organisation

whose research agenda is sponsored by the Australian insurance community. Insurance company

sponsors of Risk Frontiers include: Swiss Re; Insurance Australia Group; QBE Insurance; Suncorp

Group; Aon Benfield; Guy Carpenter and the Australian Reinsurance Pool Corporation (ARPC). ARPC

is the statutory body created to administer the Australian government’s terrorism reinsurance

scheme.

Risk Frontiers’ role is to help insurers, international reinsurers and their intermediaries better

understand and price natural catastrophe risk in the Asia-Pacific region. Risk Frontiers’ suite of

probabilistic catastrophe loss models, which includes FloodAUS, and databases are widely used by

insurers and reinsurers in Australasia, Europe, North America and Asia.

Risk Frontiers provides a rapid response reconnaissance team for its sponsors for local and

international disaster events of interest. In the last six months, it has sent teams to both

Christchurch earthquakes, the Brisbane floods and Tropical Cyclone Yasi, the latter in association

with the Cyclone Testing Station of James Cook University. It generally aims to have people on

location within days of an event and before the sites become sanitised by clean-up operations.

Risk Frontiers regularly undertakes assignments for non-sponsor insurance and reinsurance

companies and their reinsurance broking intermediaries, government and emergency management

providers; it is the primary provider of research to the New South Wales State Emergency Service

and has recently undertaken studies for the Queensland Department of Community Safety.

Risk Frontiers is the lead organisation responsible for developing the National Flood Information

Database (NFID) for the Insurance Council of Australia. NFID is a five year project aiming to integrate

flood information from all city councils in a consistent form to better enable insurers to price flood

risk.


Page 2

Introduction

This submission will contribute to the following aspects of the Commission of Inquiry’s terms of

reference:

• private insurers and their responsibilities

• land use planning

It will also make some additional comments pertinent to the:

• adequacy of forecasts and early warning systems

and decision-making in respect to the

• implementation of systems operation plans for dams

We begin with issues pertaining to the provision of flood insurance and in particular data

constraints. The views expressed in this section arise from Risk Frontiers‘ experience in jointly

developing the National Flood Information Database (NFID) for the Insurance Council of Australia

with Willis Re1. NFID is a five year project aiming to integrate in a consistent form flood information

from all city councils with significant risk to riverine flooding to better enable insurers to price this

risk.

The views and opinions of the authors expressed herein do not necessarily state or reflect those of

the companies listed above who sponsor Risk Frontiers.

1 Willis Re is an International reinsurance broking intermediary with expertise in flood risk modelling.


Page 3

Data Constraints on the Provision of Flood Insurance

While damage arising from most other natural hazards – earthquake, tropical cyclone, thunder

storm, etc. – is automatically covered by a home and contents insurance policy, riverine flood cover

is often excluded. This disparity exists because there is often little available information that would

allow an insurer to adequately price this flood risk.

Moreover, there is a certain proportion of dwellings that have been constructed in locations where

the frequency of flooding is such that this risk is not insurable at an affordable price. Consider, for

example, a home and contents policy covering a dwelling and contents valued at $400,000 and

located in a situation vulnerable to significant over floor flooding on average once in 20 years and

where total destruction is likely once in every 100 years. Based on the recent Brisbane experience,

claims in the smaller floods are likely to be around $50,000, so the actuarially-fair annual flood

insurance premium would be roughly $6,0002, excluding costs of administering this policy and

ignoring the likelihood of other floods.

We suspect few homeowners would be willing or able to pay such a premium, despite this sum

reflecting the real price of this risk.

It would be irresponsible for insurers to cover riverine flood without quantifying and pricing this risk

accordingly. The first step in establishing risk-adjusted premiums is to know the likelihood of the

depth of flooding at each address. This information has to be address-specific because the severity of

flooding can vary widely over small distances, e.g. from one side of a road to the other. The aim of

NFID is to collate and process data from local councils to enable insurers to underwrite this risk at an

address level.

An insurer can use the NFID database together with other building specific information to model the

riverine flood losses to their portfolio of insured assets. In other words, to understand and quantify

2 6,000 = 50,000/20 + (400,000 – 50,000)/100


Page 4

their risk. Unfortunately, obtaining the base data for NFID from some local councils is difficult and

sometimes impossible despite the support of all state governments for the development of it.

Councils have an obligation to assess their flood risk and to establish rules for safe land

development. However, many are antipathetic to the idea of insurance.

Some states and councils have generally been very supportive -- New South Wales (NSW) and

Victoria, particularly. Some states have a central repository -- a library of all flood studies and digital

terrain models (digital elevation data).

Council reluctance to release data is most prevalent in Queensland, where, unfortunately, no central

repository exists.

A litany of reasons is given for withholding data. At times it seems that refusal stems from a view

that insurance is innately evil. This is ironic in view of the gratuitous advice sometimes offered by

politicians and commentators in the aftermath of extreme events, exhorting insurers to pay claims

even when no legal liability exists and riverine flood is explicitly excluded from policies.

Sometimes councils express concern over the quality of their flood data but this should not be a

deterrent for releasing it. Dealing with uncertainty is an essential part of providing insurance, so this

fear is not a legitimate reason for withholding data. The NFID database contains descriptions for

each catchment expressing the degree of confidence in the underlying data.

At other times, liability concerns are invoked. These may be real as in the past some councils have

encouraged or not actively limited property development on floodplains. However, development

mistakes of the past will be revealed in the next large flood irrespective of insurance. As we have

seen in Brisbane, nature has little respect for the sensibilities of councils and land developers; the

bigger issue is reducing the practice of allowing development in harm’s way.

Another issue is that many councils only undertake flood modelling in order to create a single design

flood level, usually the so-called 1-in-100 year flood. (For reasons given later, a better term is the

flood with an annual likelihood of 1% of being exceeded.)

Inundation maps showing the extent of the 1% annual chance flood are increasingly common on

council websites, even in Queensland. Unfortunately these maps say little about the depth of water


Page 5

at an address or, importantly, how depth varies for less probable floods. Insurance claims usually

begin when the ground is flooded and increase rapidly as water rises above the floor level.

At Windsor in NSW, for example, the difference in the water depth between the flood with a 1%

annual chance of exceedance and the maximum possible flood is nine metres. In other catchments

this difference may be small, of the order of a few tens of centimetres. The risk of damage is quite

different in both cases and an insurer needs this information if they are to provide coverage in these

areas.

The ‘1-in-100 year flood’ term is misleading. To many it is something that happens regularly once

every 100 years -- with the reliability of a bus timetable. It is still possible, though unlikely, that a

flood of similar magnitude or even greater flood could happen twice in one year or three times in

successive years.

The calculations underpinning this are not straightforward but the probability that an address

exposed to a 1-in-100 year flood will experience such an event or greater over the lifetime of the

house – 50 years say – is around 40%. Over the lifetime of a typical home mortgage – 25 years – the

probability of occurrence is 22%. On these timescales, these are not good odds.

Recently, there have been calls for better elevation mapping and new flood studies. Both will

ultimately lead to a better understanding of the nation’s flood risk. But a simple and effective

solution at least in the short-term would be to compel councils to release existing flood data. Until

this is done, there is very little incentive for insurers to widely accept riverine flood risk unless at

very conservative (high) premiums.

Lastly, if flood data were more widely available then issues such as what does and does not

constitute a flood for insurance purposes would become less of an issue. The exact definition would

quickly lose relevance as flood insurance for water damage in all its guises inevitably becomes more

widely available and appropriately priced for.


Page 6

The Rising Cost of Natural Disasters

Nationally as well as globally, the cost of natural disasters is increasing (Swiss Re 2010; Munich Re

2010). In attempting to unravel the reasons for this increase we need first to acknowledge that the

risk to property from natural disasters is multi-faceted: it is a function of the hazard – the

magnitude/frequency relationships that characterise the peril; the exposure in terms of the capital

values and spatial distribution of assets at risk; and the vulnerability of these assets and communities

to the peril.

Thus it should be clearly understood that even if the frequency and magnitude of natural perils were

unchanging, the economic cost of natural disasters will increase as the value and concentrations of

property assets in exposed areas increases. Growth in population and wealth has certainly occurred

throughout south east Queensland and northern NSW (Figures 1a and b). This area represents one

of the most rapidly developing regions in Australia. Concentrations of population at risk pose

particular challenges for emergency management in terms of the number of people and the time

required for evacuation in the case of an impending flood.

Figure 1a: Increase in the number of dwellings in the Gold Coast-Tweed Heads area (source:

Australian Bureau of Statistics (www.abs.gov.au)).


Page 7

Figure 1b: Increase in the national average nominal value of dwellings (source: derived from

Australian Bureau of Statistics data (www.abs.gov.au)).


Page 8

Insured Losses – What Would They Cost Today?

The Insurance Council of Australia (ICA) maintains a Natural Disaster Event List, a database of natural

hazard events in Australia that have caused significant insured losses (Figure 2a). The list begins in

1967 with the Hobart bushfires and although the threshold loss for inclusion in the database has

varied over time, most refer to events with insured losses in excess of $10 million. Figure 2a shows

the time history of losses (in the dollars of the day) excluding five non-weather-related events – four

earthquakes and one tsunami. Annual losses have been calculated for years beginning 1 July to take

account of the southern hemisphere seasonality of the main meteorological hazards.

Figure 2b gives the normalised values (Crompton and McAneney, 2008) which are the original losses

adjusted for changes in the number of dwellings, their average nominal value and, in the case of

tropical cyclones, the impact of improved construction standards stemming from investigations of

engineering failures identified as contributing to building losses in Cyclone Tracy in 1974 (Walker,

1975; Mason and Haynes, 2010). Loss normalisation is the process of estimating the impact of past

events on present society and is necessary for determining whether the devastation inflicted by

particular events, such as the 2011 Brisbane floods, is truly anomalous or not; whether this event

provides a glimpse of the future under expected changes in climate; and more broadly what policy

changes might prove effective in reducing the impact of future disasters.

Figure 2b reveals that no time trend remains after normalisation and Crompton and McAneney

(2008) concluded from this that the increasing trend in unadjusted losses (Figure 2a) is largely

accounted for by changes in the number and value of dwellings.

The 1974 Brisbane flood insured loss (Tropical Cyclone Wanda) normalised to year 2006 values is

$2.1 billion (Crompton and McAneney, 2008). Normalising the 1974 loss to year 2011 values using

the Crompton and McAneney (2008) methodology results in an insured loss around $3 billion.

Current industry provisions for the 2011 Brisbane floods are $2.3 billion, which sounds reasonable

given that the recent event peaked at the Brisbane River City Gauge 1 m lower than the 1974 event.

In making these comparisons we note that no change in insurance policy conditions have been

considered.


Page 9

It is not clear how the 1974 and 2011 Brisbane flood losses compare in economic loss terms.

Previous but flawed attempts have been made to estimate the economic costs of natural disasters in

Australia (e.g. Bureau of Transport Economics (2001)) but these efforts have neither been updated

nor their errors – not accounting for increases in wealth and ad hoc adjustments for inflation –

corrected.

The conclusion of Crompton and McAneney (2008), that societal changes are the principal factors

responsible for increasing losses to date, is consistent with the conclusions of Höppe and Pielke

(2006) and Bouwer (2010). The latter study reviewed 21 weather-dependent international loss

normalisation studies across multiple hazards and jurisdictions.


Page 10

Figure 2a: Original annual aggregate insured losses ($million) for weather-related events in the ICA

database for 12-month periods beginning 1 July (source: Crompton and McAneney (2008)).

Figure 2b: As for (a) above but losses have been normalised to 2006 values (source: Crompton and

McAneney (2008)).


Page 11

The Importance of Risk-informed Land Use Planning in

Reducing Disaster Losses

Whereas insurers are compelled by regulation to prove they have the financial resources (in terms of

retained capital or reinsurance) to deal with a 1-in-250 year event loss, land use planning for

flooding in Australia is often unduly preoccupied with the 1-in-100 year event. These authors take

the view that land use planners (and emergency management) should also consider lower frequency

/ higher severity events. This is a point also made by the Joint Flood Taskforce in their report to the

Brisbane City Council in March 2011 in advocating a more comprehensive risk-based approach.

The best example of disaster risk reduction in Australia, other than the movement of some towns off

the floodplain (e.g. Gundagai, NSW, after successive large floods in 1852 and 1853 killed 89 of the

local population of 250) and the more recent raising of key evacuation roads in some flood-prone

areas (Hawkesbury-Nepean Floodplain Management Committee, 2004), is the regulated use of the

Building Code for residential homes introduced in cyclone-prone parts of the country following

engineering investigations into the damage caused by Tropical Cyclone Tracy (Walker, 1975; Mason

and Haynes, 2010). A study undertaken for the Australian Building Codes Board (McAneney et al.,

2007) suggests these changes have potentially reduced Australian cyclone losses by some 65%, and

in the event of a similar event to Tracy would avoid the need for the wholesale evacuation of three

quarters of the population of Darwin as occurred in 1974 (Mason and Haynes, 2010). These changes

have impacted the construction of residential homes throughout Australia.

In short, reducing disaster losses is largely a function of how and where we build; in other words,

risk-informed land use planning decisions and good building codes and construction practices are

needed.

If we truly want to reduce our vulnerability to future natural disasters in the short and long term,

then policies and research should be directed towards helping communities adapt to the more

extreme expressions of climate. And we need land use planning policies based on risk. This is a

critical issue and the canonical 1-in-100 year event should be viewed as only one manifestation of a

spectrum of possible flood depth outcomes.


Page 12

Manual of Operational Decisions for Wivenhoe Dam

The operators of the Wivenhoe and Somerset Dams (SEQWater) control outflows from the dams

with reference to “the Operations Manual”: Operational Procedures for Flood Mitigation at

Wivenhoe Dam and Somerset Dam, Revision 7, November 2009.

This document lists the flood mitigation objectives, in descending order of importance, as

• Ensure the structural safety of the dams

• Provide optimum protection of urbanised areas from inundation

• Minimise disruption to rural life in the valleys of the Brisbane and Stanley Rivers

• Retain the storage at Full Supply Level at the conclusion of the Flood Event

• Minimise impacts to riparian flora and fauna during the drain down phase of the

Flood.

The document also lists four main Strategies (and several sub strategies) for water releases from

Wivenhoe Dam depending on the predicted reservoir level. These strategies were designated as

W1A through to W1E, W2, W3, and W4A and W4B, each representing an increase in the predicted

quantity of water in the flood compartment of the dam. For each Strategy the document lists the

maximum release rate for the predicted reservoir level. That maximum is subject to certain other

constraints, including downstream river heights and downstream river flow rates.

Revision 7 of the document, dated November 2009, allows the selection of release strategy to be

based on the predicted water levels, whereas the previous revision (Revision 6) used actual levels.

This means that during an event where the dam levels are rising a particular operating strategy

would normally be selected earlier under Revision 7 than it would have been under Revision 6.

Predictions about water levels are based on inflow rates, and inflow rates are based on expected

rainfall in the catchment. This rainfall information is typically received from the Bureau of

Meteorology (BoM). The rainfall forecasts are made using the best available meteorological practice,

but cannot and should not be expected to be exact. They should be interpreted as probabilistic


Page 13

estimates of rainfall, rather than as deterministic point values, since there is likely to be some

uncertainty in the forecast.

From a statistical viewpoint a probabilistic estimate of some variable is generally represented as an

interval within which there is, say, a 95% likelihood that the true value of the variable will lie. These

confidence intervals, whether expressed or not, will be large and this uncertainty needs to be taken

into account in SEQWater’s decision making.

Decision making by rules may work well in a library but is dangerous in a dynamically changing

situation.

Timing is also crucial. A BoM forecast of 100 mm of rainfall over a certain area in a certain time

interval several hours in the future will obviously contain uncertainty. However as time goes by the

BoM forecasters will be able to upgrade the forecast as more information becomes available. This

improved forecast should allow dam operators to make a more accurate decision about an

appropriate water release strategy. This is known to statisticians as “Bayesian updating”. This can be

done iteratively.

It is not clear from an examination of the Operations Manual whether or not uncertainty in rainfall

estimates were considered when developing the decision rules contained in the “Wivenhoe Flood

Strategy Flow Chart” (Page 23 of the Operational Manual). It is likely that the flow chart could be

amended to incorporate the output of research (possibly a series of Monte Carlo simulations) into

the impact of varying levels of uncertainty in rainfall on dam water level and downstream flows. This

is likely to be useful in helping to optimise the water release strategy.

Thus, the way in which uncertainty in rainfall estimates is assimilated and processed might have a

direct bearing on the strategy that is followed for water release.


Page 14

Flood Warnings

Although time constraints prevented researching this question in any detail, the previous Director of

Risk Frontiers, Emeritus Professor Russell Blong, recalls that a high proportion of the insured losses

to residential property occasioned by the 1974 Brisbane flood comprised moveable items. This was

despite the fact that the floods had been very well forecast with a 21 hour lead time.

Accuracy in terms of a forecasted flood levels at the Brisbane River City Gauge is one thing, but a

forecast cannot be termed effective unless it translates into appropriate action by the public. In 1974

this did not happen and in 2011 not much had changed: Risk Frontiers’ Rapid Field Assessment team

found that even where people had attempted to raise belongings prior to the arrival of floodwaters,

few had any idea of how high flood waters might rise at their location. Flood warnings need to be

personalised.

In general, it seems very difficult for warnings to translate into effective actions as reflected in the

words of Governor Lachlan Macquarie who in 1819 and in respect to flooding berated “Settlers” in

NSW who did not pay “due consideration of their own interests.” Perhaps the issue is that few

people understand the risks to which they are exposed and again this has to come back to the lack of

openness of councils to provide flood information, apathy on the part of homeowners, or a

combination of both.

Similarly, the weather conditions during the Black Saturday bushfires were very well forecast and

accurate warnings were issued to emergency responders, politicians, and the public prior to

February 7. What Black Saturday clearly demonstrated is that despite accurate weather forecasts

and significant emergency/bushfire planning and response, there is always the potential for large-

scale life and property loss (Crompton et al., 2011). Providing warnings is only one step in a very

complicated chain. The difficulty is achieving adequate preparedness and risk reduction among the

community so that people can respond effectively when warnings are given (Crompton et al., 2011).

Councils need to be open about the flood risks. A flood warning is fine, but the next important

question is “what does this mean for me?” People need to understand the risk to their home and

family. Surveys conducted after the 1974 Brisbane flood showed that 46% of respondents’ first

indication of flooding came from watching water rising and 44% first thought that their home might


Page 15

be inundated when they either noticed water had entered their grounds or was under the house

(Short, 1976).

And most importantly, councils need to avoid amplifying the risk by inappropriate land use planning

decisions.


Page 16

References

Bouwer, L. M., 2011. Have disaster losses increased due to anthropogenic climate change? Bull.

Amer. Meteor. Soc. 92, 39–46. doi: 10.1175/2010BAMS3092.1

Bureau of Transport Economics, 2001. Economic costs of natural disasters in Australia. Bureau of

Transport Economics, Report 103. [Available at

http://www.bitre.gov.au/publications/99/Files/r103_lores.pdf]

Crompton, R. P., K. J. McAneney, K. Chen, R. A. Pielke Jr., and K. Haynes, 2011. Reply to the Nicholls

(2010) comment on Crompton et al. (2010), “Influence of location, population, and climate on

building damage and fatalities due to Australian bushfire: 1925-2009”. Wea. Climate Soc. (in press).

Crompton, R.P., and K.J. McAneney, 2008. Normalised Australian insured losses from meteorological

hazards: 1967 - 2006. Environ. Science & Policy 11: 371-378.

Hawkesbury-Nepean Floodplain Management Steering Committee. 2004. Hawkesbury-Nepean

Floodplain Management Strategy Implementation. Hawkesbury-Nepean Floodplain Management

Steering Committee, Parramatta, 42 pp.

Höppe, P., and R. A. Pielke Jr., Eds., 2006. Workshop on climate change and disaster losses:

Understanding and attributing trends and projections. Final Workshop Report, Hohenkammer,

Germany.

http://sciencepolicy.colorado.edu/sparc/research/projects/extreme_events/munich_workshop/wor

kshop_report.html

Mason, M., and K. Haynes, 2010. Case Study: Cyclone Tracy. Report prepared for the National

Climate Change Adaptation Facility. Risk Frontiers.

Munich Re, 2010: Natural catastrophes 2009. Analyses, assessments, positions. TOPICS GEO.

(http://www.munichre.com/publications/302-06295_en.pdf).

Short, P., 1974. ‘Victims’ and ‘Helpers’. Pp. 448 – 459. In Proceedings of Symposium on Natural

Hazards in Australia; Eds. R.L. Heathcoate and B.G. Thom. Australian Academy of Science , Canberra.


Page 17

Swiss Re, 2010. Natural catastrophes and man-made disasters in 2009: catastrophes claim fewer

victims, insured losses fall. sigma No 1/2010.

(http://media.swissre.com/documents/sigma1_2010_en.pdf).

Walker, G. R., 1975. Report on Cyclone Tracy – Effects on Buildings – December 1974. Australian

Department of Housing & Construction, Melbourne, Australia.

(http://www.eng.jcu.edu.au/cts/learning.htm)


Page 18

Curricula Vitae

Attached are Curricula Vitae for:

• John McAneney, Director of Risk Frontiers

• Keping Chen, Senior Risk Scientist

• Ryan Crompton, Catastrophe Risk Scientist

• Matthew Mason, Research Engineer

• Rob van den Honert, Deputy Director of Risk Frontiers

Curriculum Vitae – John McAneney

John McAneney

Education

PhD. University of

Wisconsin-Madison, USA

Master of Science.

University of Wisconsin-

Madison, USA

Bachelor of Science Hons.

(1st Class - Physics)

Auckland University, NZ.

Contact Details Risk Frontiers – Natural Hazards Research Centre Macquarie University NSW 2109

Direct: 61 2 9850 9685 Fax: 61 2 9850 9394 [email protected]

John McAneney

Curriculum Vitae

Profile

Professor John McAneney is the Director of Risk Frontiers, an

independent Natural Hazards Research Centre, based at Macquarie

University to provide the insurance industry with modelling

expertise related to the pricing and understanding of natural

hazards risks and catastrophe exposure. Risk Frontiers is also

increasingly working with emergency managers.

John’s speciality hazard interests are in bushfire, flood, volcanic and

seismic risk and decision-making and policy issues surrounding a

wide range of natural hazards. He has expertise in Probabilistic

Modelling, Quantitative Risk Assessment and Cost-Benefit and Real

Options analyses.

John’s earlier background was in physics, soil science, weather risk

and financial risk analysis. He has 85 refereed publications on

various aspects of weather risk, boundary layer physics and natural

catastrophe risks. He has French language skills.

Miscellaneous Consulting Experience

• Policy options for managing flood risk.

• Evaluation of Australian Regulatory Prudential Authority policy

vis-à-vis minimum capital requirements for insurers to cover

natural catastrophe losses and how this varies between a multi-

peril, whole-of-country portfolio approaches and single site,

single-peril interpretations.

• Bushfire vulnerability of residential buildings as a function of

distance from bushland-urban interface as presented to the

Royal Commission into the 2009 Victorian bushfires

• Estimating the emergence time scale for a global climate change

signal to be evident in economic losses from US hurricanes.


• CEO of Risk Frontiers Flood Australia Ltd’s development of the National

Flood Information Database for the Insurance Council of Australia to allow

its members to underwrite flood risks.

• Normalisation of the Insurance Council of Australia’s (ICA) database of

natural disaster insured losses for changes in population, wealth, inflation,

and, in the case of tropical cyclones, building code regulations.

Undertaken to estimate current cost of natural disasters if historic events

were imposed upon today’s societal conditions and whether a climate

change signal could be discerned.

• Normalisation of the time history of bushfire property losses and fatalities

since 1926 and the utility of ENSO and the Indian Ocean Dipole phases as

predictors of likelihood of extreme property damage.

• Probable Maximum Loss modelling of Australian bushfire losses.

• Estimation of the catastrophe loss exposure due to Australasian natural

disasters for an international reinsurance company.

• Costing the benefits of improved construction standards in tropical

cyclone-threatened regions of Australia for Australian Building Codes

Board.

• Development of a probabilistic model of the public liability due to flooding

in the wake of levee failure and/or overflow for the Launceston City

Council and the State Government of Tasmania.

• Post-disaster damage assessments in Banda Aceh and Meulaboh, Aceh

Province, Sumatra and Sri Lanka immediately following the Dec 26, 2005

Mw=9.3 earthquake and tsunami.

• Analysis of tephra (ash) fall risk from explosive volcanic eruptions in the

Asia-Pacific region.

• Provided specialist advice to the Treasury of the Government of Colombia

using a Real Options to value contingent liabilities arising from granting

public guarantees for infrastructure projects given under concession to the

private sector.

• Development of an economic model to value investments in new irrigation

schemes used to encourage the early development of the kiwifruit

industry in New Zealand. The Ministry of Works and Development used

this model to evaluate the economic returns from community irrigation

schemes.

Previous Professional Positions

• Director, Applied Decision Analysis, PricewaterhouseCoopers, Sydney,

Australia (2001-2002)

• Manager, Arthur Andersen, Global Corporate Finance

Auckland, New Zealand (1999 - 2001)

• Self-employed, CorporateMaths, Auckland, New Zealand (1998 - 99)


• Scientist - Environment, HortResearch, Kerikeri, NZ

(1985 - 98); Group Leader, Environmental Physics, Ministry Agriculture &

Fisheries, Hamilton, NZ (1973 - 1985)

• Invited Scientist – Alpilles International Experiment, St Remy, France

(1996); Visiting Scientist - CSIC, Estacion Experimental de Aula Dei,

Zaragoza, Spain (1991); INRA Station de Bioclimatologie, Bordeaux, France

(1990-91); INRA Station de Bioclimatologie, Montfavet, France (1984 - 85)

Publications

• 85 scientific papers in international refereed scientific journals plus

another 5 in review

• ~100 popular articles and client reports

Book Where Wine Flows like Water - A Gastronomic Pilgrimage through Spain

(HarperCollins, 1997)

Recent Relevant Scientific Publications

1. Crompton, R. P., R. A. Pielke Jr.

and K. J. McAneney, 2011. Emergence time

scales for detection of anthropogenic climate change in US tropical cyclone

loss data. Environmental Research Letters, 6, 014003, doi: 10.1088/1748-

9326/6/1/014003.

2. Ashe, B., McAneney, K.J. and A.J. Pitman, 2010. Is the allocation of

resources towards mitigation and response to fire in Australia optimal? J.

Risk Res. (in press).

3. Roche, K., McAneney, K.J. and R. van den Honert, 2010. Policy options for

managing flood insurance. Environmental Hazards 9:369-378.

4. Crompton, R. P., K. J. McAneney, K. Chen, R. A. Pielke Jr., and K. Haynes,

2010. Influence of Location, Population and Climate on Building Damage

and Fatalities due to Australian Bushfire: 1925-2009. Weather, Climate and

Society, Vol. 2: pp. 300-310.

5. Haynes, K.A., Handmer, J., McAneney, K.J., Tibbits, A. and L. Coates, 2009.

Australian civilian bushfire fatalities: 1900 – 2007. Environ. Sci. & Policy

13:185-194.

6. Chen, K., McAneney, K.J. and K. Cheung. (2009) Quantifying changes in

wind speed distributions in the historical record of Atlantic tropical

cyclones. Natural Hazards –Earth Systems Science 9:1749–1757. www.nat-

hazards-earth-syst-sci.net/9/1749/2009/

7. Roche, K., McAneney, K.J. and Crompton, R. 2009. Post-PML Depression: Is

the 1-in-250 Maximum Probable Loss the correct metric. In Proceedings of

Beyond PML: Frequency vs. Severity 2009. [Editor: N. Britton]. Aon

Benfield Australia.


8. Haynes, K., Coates, L., Leigh, R., Handmer, J., Whittaker, J., Gissing, A.,

McAneney, J. and S. Opper, 2009. ‘Shelter-in-place’ versus evacuation in

flash floods. Environ. Hazards 8: 291-303.

9. McAneney, K.J., Chen, K., and A.J. Pitman, 2009. 100-years of Australian

bushfire property losses: Is the risk significant and is it increasing? J.

Environmental Management 90:2819-2822.

10. Ashe, B., McAneney, K.J. and A.J. Pitman, 2008. The total cost of fire in

Australia. J. Risk Res. 12:2, 121-136.

11. Crompton, R.P. and K.J. McAneney. 2008. The cost of natural disasters in

Australia: the case for disaster risk reduction. Australian J. of Emergency

Management, 23:43-46.

12. Crompton, R.P. and K.J. McAneney. 2008. Normalised Australian insured

losses from meteorological hazards: 1967 -2006. Environ. Science & Policy

11: 371-378.

13. Yeo, S.W, Blong, R.J. and K.J. McAneney. 2007. Flooding in Fiji: findings

from a 100-year historical series. Hydrological Sciences Journal. 52:1004-

1015.

14. Crompton, R., McAneney, J., Chen, K., Leigh, R. and L. Hunter. 2008.

Property losses due to natural hazards, Chapt. 18, pp. 281- 293. In:

Newton, P. (Ed.). Transitions: Pathways towards a More Sustainable Urban

Development in Australia. CSIRO Publishing Melbourne.

15. Chen, K and K.J. McAneney. 2006. High-resolution estimates of Australian

coastal population: with validations of global data on population, shoreline

and elevation. Geophysical Research Letters, 33, L16601,

doi:10.1029/2006GL026981.

Keping CHEN

Education

PhD (Natural Hazards), 2000,

Macquarie University, Sydney,

Australia

MSc (Environmental

Sciences), 1996, Beijing

Normal University, Beijing,

China

BSc (Geography), 1993,

Hangzhou (Now Zhejiang)

University, Hangzhou, China.


Direct: 61 2 9850 9473 Fax: 61 2 9850 9394

[email protected]

Curriculum Vitae –Keping Chen

Keping Chen

Curriculum Vitae Profile

Dr Keping Chen is a Senior Risk Scientist at Risk Frontiers. He has

developed research interests and expertise in natural hazards and

risk assessment, using GIS, remote sensing and applied

mathematics. He has been actively involved in various applied

projects in quantitative risk assessment, catastrophe loss modelling

and risk computation since 2000, such as quantifying flood risk,

bushfire penetration into urban areas, estimating coastal exposure

across the country, developing natural hazard risk ratings at multiple

spatial units, programming terrorism blast loss model for major

capital cities, and examining changes of wind speed distributions in

the historical record of Atlantic hurricanes.

Relevant Experience

• Responsibility for the development and project management

of the National Flood Information Database (NFID) – funded

by the Insurance Council of Australia.

• Assessment of natural hazard disaster risk in Queensland:

Analysing and mapping current state-wide exposure

vulnerable to bushfire, sea level rise, riverine flooding and

tropical cyclone winds – funded by QLD DCS.

• Revising Insurance Council of Australia (ICA) risk zones (aka

CRESTA zones) widely used by the international and

Australian insurance industry.

• Development of national terrorism blast loss model.

• Creation of a national coastal vulnerability database.

• Creation of a national bushfire risk rating database.

• Overview of natural hazard risk in the Asia Pacific region for

AUSAID: Establishment of exposure spatial databases.

• Defining area at risk in catastrophe loss modelling and

associated spatial uncertainty analysis.

• Programming flood loss estimation modules.

• PerilAUS version II – multi-hazard relative risk ratings for

postcode and CRESTA Zones.

• PhD thesis: Developing an integrative approach for natural

hazard risk assessment using GIS

Curriculum Vitae –Keping Chen

Work

2000 – Now: Risk Scientist/Senior Risk Scientist, Risk Frontiers-NHRC, Macquarie

University, Australia

1997-2000: Research Assistant; NHRC, Macquarie University

Journal Articles

• Chen, K., McAneney, J., and Cheung, K., 2009. Quantifying changes of wind

speed distributions in the historical record of Atlantic tropical cyclones,

Natural Hazards and Earth System Science, 9, 1749-1757.

• Chen, K., and McAneney, J., 2006. High-resolution estimates of Australia's

coastal population. Geophysical Research Letters. 33, L16601 (Research

findings highlighted in ABC’s 7:30 program, 10+ newspapers, etc.)

• Chen, K., and McAneney, J., 2005. The bushfire threat in urban areas.

Australasian Science, 26(1), 14-16. (Research findings highlighted in 10+

newspapers, radio broadcasts, etc.)

• Chen, K., and McAneney, J., 2004. Quantifying bushfire penetration into urban

areas in Australia, Geophysical Research Letters, 31, L12212 (Research

findings highlighted in Nature, 10+ newspapers, radio broadcasts, etc.)

• Chen, K., McAneney, J., Blong, R., Leigh, R., Hunter, L., and Magill, C., 2004.

Defining area at risk and its effect in catastrophe loss estimation: A

dasymetric mapping approach. Applied Geography, 24(2), 97-117.

• Chen, K., 2004. Catastrophe modelling and its major overseas developers.

Journal of Natural Disasters, 13(2), 1-8.

• Chen, K., Blong, R., and Jacobson, C., 2003. Towards an integrated approach to

natural hazards risk assessment using GIS: With reference to bushfires.

Environmental Management, 31(4), 546-560.

• Chen, K., 2002. An approach to linking remotely sensed data and areal census

data. Int. J. Remote Sensing, 23(1), 37-48.

• Chen, K., Blong, R., and Jacobson, C., 2001. MCE-RISK: Integrating multi-criteria

evaluation and GIS for risk decision-making in natural hazards. Environmental

Modelling and Software, 16(4), 387-397.

Other Publications

Conference papers (15), Reports (15), Software (5).

Curriculum Vitae –Ryan Crompton

Ryan Crompton

Education

Postgraduate Diploma in

Accounting, Macquarie

University, Australia.

Bachelor of Science

(Advanced Mathematics)

Macquarie University,

Australia.


Direct: 61 2 9850 6377 Fax: 61 2 9850 9394 [email protected]

Ryan Crompton

Curriculum Vitae

Profile

Ryan Crompton is a Catastrophe Risk Scientist with Risk

Frontiers responsible for the scientific inputs for and the

validation of Risk Frontiers’ tropical cyclone loss estimation

models for Australia and South Korea. He has previous

experience in the numerical modelling of oceans in order to

better understand El Nino-Southern Oscillation events.

Ryan also has a strong interest in Alternative Risk Transfer and

the securitisation of catastrophe risk, particularly the pricing and

structure of Catastrophe Bonds.

Ryan’s part-time PhD studies in environmental science are

examining the relative role of climate change and societal

factors in rising weather-related disaster losses.

Experience

• Rapporteur for the Economic Impacts of Tropical Cyclones

Session at the 2010 Seventh International Workshop on

Tropical Cyclones held at La Réunion.

• Invited speaker at the workshop on the Economic Loss from

Natural Disasters at the London School of Economics (2010).

• Responsible for the development of Risk Frontiers' tropical

cyclone wind loss estimation models, CyclAUS and SiNatCat

and validation of these models.

• Normalising the Insurance Council of Australia’s database of

natural hazard disasters for changes in wealth, population,

inflation and building codes for wind loading

• Examining the factors responsible for the increasing losses

due to natural hazards

• Valuing a hypothetical Australian catastrophe bond

• Analysis of the reinsurance cost of the national risk of

bushfire in Australia

• Post-cyclone damage assessments in Florida (2004),

Queensland (2006) and (2011).

• Developed a financial risk assessment simulation model for

exploration mining industry

Curriculum Vitae –Ryan Crompton

Professional Positions

• Catastrophe Risk Scientist – Tropical Cyclone Specialist, Macquarie

University, Sydney, Australia (2003 – present)

• Research Assistant – Physical Geography, Macquarie University (2002)

Refereed Journal Articles

• Crompton, R. P., K. J. McAneney, K. Chen, R. A. Pielke Jr., and K. Haynes,

2011. Reply to the Nicholls (2010) comment on Crompton et al. (2010),

“Influence of location, population, and climate on building damage and

fatalities due to Australian bushfire: 1925-2009”. Wea. Climate Soc. (in

press).

• Crompton, R. P., R. A. Pielke Jr.,

and K. J. McAneney, 2011. Emergence

timescales for detection of anthropogenic climate change in US tropical

cyclone loss data. Environ. Res. Lett., 6, 4pp. [Available at

http://iopscience.iop.org/1748-9326/6/1/014003?fromSearchPage=true]

• Crompton, R. P., K. J. McAneney, K. Chen, R. A. Pielke Jr., and K. Haynes,

2010. Influence of location, population, and climate on building damage and

fatalities due to Australian bushfire: 1925-2009. Wea. Climate Soc., 2, 300-

310.

• Crompton, R. P., and K. J. McAneney, 2008. Normalised Australian insured

losses from meteorological hazards: 1967-2006. Environ. Sci. Policy, 11, 371-

378.

• Bouwer, L. M., R. P. Crompton, E. Faust, P. Höppe, and R. A. Pielke Jr., 2007.

Confronting disaster losses. Science, 318, 753. [Available at

http://sciencepolicy.colorado.edu/admin/publication_files/resource-2573-

2007.27.pdf]

Other Publications

Other Journal Articles (3), Conference / Workshop papers (~15), Reports

(~15), Book Chapters (1)

Curriculum Vitae –Matthew Mason

Matthew Mason

Education

PhD. University of

Sydney,Australia

Master of Science. Texas

Tech University, USA

Bachelor of Engineering

(Civil) Hons. University of

Queensland, Australia.


Direct: 61 2 9850 8387 Fax: 61 2 9850 9394

[email protected]

Matthew Mason

Curriculum Vitae

Profile

Matthew Mason is a Research Engineer with Risk Frontiers specialising

in the study of atmospheric hazards and their interaction with the built

environment. Matthew joined Risk Frontiers in 2009 after completing

a PhD and lecturing in the School of Civil Engineering at the University

of Sydney.

Experience

• Led and/or participated post-disaster damage investigations

after the Queensland floods (2011 – Brisbane and Grantham),

Cyclone Yasi (2011), Christchurch earthquake (2010 & 2011).

• Contributed to the development and implementation of

catastrophe loss model for tropical cyclones in Australia.

• Lectured fluid mechanics at an Undergraduate level, including

introductory hydraulics and hydrology.

• Developed engineering models (physical and numerical) for the

simulation of tornado and thunderstorm outflow winds.

• Investigated the interaction between structures and

thunderstorm, tornado, and boundary layer winds.

Professional Positions

• Research Engineer, Risk Frontiers, Macquarie University (2009 –

present).

• Lecturer, School of Civil Engineering, University of Sydney,

Sydney, Australia (2009)

• Tutor/Laboratory assistant/PhD student, School of Civil

Engineering, University of Sydney, Sydney, Australia (2004 -

2009)

• Research Engineer, Wind Engineering Services, University of

Sydney, Sydney, Australia (2003 - 2004)

• Wind Science Research Assistant, Wind Science and Engineering

Research Center, Texas Tech University, Lubbock, Texas (2002 -

2003).

• Research Fellow – APEC Short Term Research Fellowship, Tokyo

Polytechnic University, Tokyo, Japan (2007)

Curriculum Vitae –Matthew Mason

Refereed Journal Publications

• Mason, M., Haynes, K., Walker, G. (2011) Cyclone Tracy and the road to

improving wind resistant design. In Natural Disasters and Adaptation to

Climate Change. Editors: Jean Palutikof, David Karoly, Sarah Boulter.

Cambridge University Press (in press).

• Mason, M.S., Wood, G.S., Fletcher, D.F. (2010), “Numerical simulation of

idealised three-dimensional downburst wind fields”, Engineering Structures.

32, 3558-3570.

• Mason, M.S., Wood, G.S., Fletcher, D.F. (2010), “Numerical investigation of the

influence of topography on simulated downburst winds”, Journal of Wind

Engineering and Industrial Aerodynamics. 98, 21-33.

• Mason, M.S., Wood, G.S., Fletcher, D.F. (2009), “Numerical simulation of

downburst winds”, Journal of Wind Engineering and Industrial Aerodynamics.

97, 523-539.

• Mason, M.S., Wood, G.S., Fletcher, D.F. (2009), “Influence of tilt and surface

roughness on the outflow wind field of an impinging jet”, Wind and Structures.

12(3), 179-204.

• Mason, M.S., James, D.L., Letchford, C.W. (2009), “Wind loading on a cube

subjected to pulsed wall jet simulation of a stationary thunderstorm

downbursts”, Wind and Structures 12(1), 77-88.

• Mason, M.S., Wood, G.S., Fletcher, D.F. (2007), “Impinging jet simulation of

stationary downburst flow over topography”, Wind and Structures. 10(5), 437-

462.

• Mason, M.S., Letchford, C.W., James, D.L. (2005), “Pulsed wall jet simulation

of a stationary thunderstorm downburst, Part A: Physical structure and flow

field characterization, Journal of Wind Engineering and Industrial

Aerodynamics. 93(7), 557-580.

Major Reports

Mason, M. and Haynes, K. (2010). Case study: Cyclone Tracy. Report for the

National Climate Change Adaptation Research Facility (NCCARF) Synthesis and

Integrative Research Project, Risk Frontiers.

Other Publications

13 Conference and Workshop papers

Curriculum Vitae –Rob van den Honert

Rob van den Honert

Education

PhD. University of Cape Town

MSc University of Cape Town

Bsc University of Cape Town


Direct: 61 2 9850 4421 Fax: 61 2 9850 9394

[email protected]

Rob van den Honert

Curriculum Vitae

Profile

Dr Rob van den Honert is Co-Deputy Director at Risk Frontiers. His

interests lie in flood risk and damage analysis, and decision

modelling (particularly modelling of complex decisions and

prioritisations involving multiple decision criteria) surrounding a

wide range of natural hazards. He has experience in modelling

natural hazard risks and impacts for the emergency management

sector.

Rob’s earlier background was in statistical science, mathematics of

finance, decision modelling, and market research, and he has 25

referred publications on various aspects of multi criteria decision

making, and finance. His background in statistics has led to him

gaining expertise in stochastic modelling, quantitative risk

assessment, and decision making in the face of uncertainty.

Experience

Recent relevant projects for Risk Frontiers include:

• Prepared a flexible multi-criteria resource allocation model for

the NSW Fire Brigades.

• Managed a project for NSW Department of Environment,

Climate Change and Water examining the future vulnerability

of the state in respect of natural hazards, focusing on

emergency management. The objectives of the project were

to identify past and potential future scenarios in which natural

hazards in NSW have given, or could potentially give, rise to

emergency situations and to identify the likely impacts of

climate change on each category of natural hazard that may

give rise to significant emergency scenarios.


• Managed a project for Queensland’s Department of Community Safety which

produced a state-wide prioritised natural disaster risk assessment for the

state. The assessment included examining the current natural hazard risk

profile, the natural hazard risk profile after consideration of the impact of a

range of existing risk reduction / disaster mitigation treatments, and climate

change impacts that may alter the natural hazard risk profile in the future.

Professional positions

• Co-Deputy director, Risk Frontiers NHRC, Macquarie University (2009 –

present)

• Manager: Research and Analysis, Australian Rugby Union (2002-2005)

• Manager: Research and Analysis, Football Federation Australia (2006-2009)

• Associate Director, Applied Decision Analysis, PricewaterhouseCoopers,

Sydney, Australia (2001-2002)

• Professor and Head of Department of Statistical Sciences, University of Cape

Town, South Africa (1988-2001)

Relevant publications

• Van den Honert R C (1998). “Stochastic Pairwise Comparative Judgements and

Direct Ratings of Alternatives in the REMBRANDT System”. Journal of Multi-

Criteria Decision Analysis, 7, 87-98.

• Van den Honert R C (1998). “Stochastic Group Preference Modelling in the

Multiplicative AHP: A Model of Group Consensus”. European Journal of

Operational Research, 110, 99-111.

• Stewart T J and Van den Honert R C (editors) (1998). Trends in Multicriteria

Decision Making, ISBN 3-540-64741-4, 458pp., Springer-Verlag, Heidelberg,

Berlin.

• Van den Honert R C (2000). “Fair Allocations Using Multicriteria Power

Indices”. In Haimes, Y Y and Steuer, R E (editors) Research and Practice in

Multiple Criteria Decision Making, Springer-Verlag, Heidelberg, Berlin, 530-

541.

• Van den Honert R C (2001). “Decisional Power in Group Decision Making: A

Note on the Allocation of Group Members’ Weights in the Multiplicative AHP

and SMART”. Group Decision and Negotiation, 10, 275-286.

• Losa F B, Van den Honert R C and Joubert A (2001). “The Multivariate Analysis

Biplot as a Tool for Conflict Analysis in MCDA”. Journal of Multi-Criteria

Decision Analysis, 10, 273-284.

• Roche K M, McAneney, K J and Van den Honert, R C (2010). “Policy Options for

Managing Flood Insurance”. Environmental Hazards, 9, 369-378.


• Bird, D, Haynes, K, Van den Honert, R C and McAneney, J (2011). “Nuclear

Spring?” Australian Science, March 2011, 36-38.

Other publications

Other refereed journal articles (19), Conference papers (9), Books (1), Other

articles (4).

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