Catastrophe Modeling: A New Approach to Managing Risk by Patricia Grossi and Howard Kunreuther, managing editors Springer 2005.

This major publication from two professors in the Risk Management and Decision Processes Center at the Wharton School University of Pennsylvania, systematically analyses how catastrophe models can be used to assess and manage risks of extreme events. It focuses on natural disaster risk, but also discusses terrorism.

It brings together contributions from the three leading catastrophe modelling firms, AIR Worldwide, EQECAT, Risk Management Solutions (RMS), with the Wharton team on how to assess the risk from natural hazards. Chandu Patel of KPMG and the Casualty Actuarial Society served in an editorial role, and other interested groups provided feedback and input.

The intended audience for this book is the sophisticated risk manager or policy maker who has some appreciation for the role that modelling and quantitative analysis can play in improving the decision making process.

The contents explicitly address uncertainty in the context of catastrophe modelling, illustrate the relationship between risk assessment and risk management through insurance rate making, insurance portfolio management and risk financing, and describe how uncertainty and risk transfer mechanisms affects the analysis of mitigation using three model cities. The emphasis is predominantly on the United States, but there is plenty of material of wider interest. MEGACITIES

Munich Re's Megacities - Megarisks: Trends and challenges for insurance and risk management is available online at CLIMATE, CATASTROPHES AND TERRORISM

Aon has published its 2004 Annual Global Climate and Catastrophe Report, US Climate and Catastrophe Report and 2004 Terrorism Risk Management & Risk Transfer Market Overview. All are available from Aon at TSUNAMI

Tsunami: Indian Ocean Event and Investigation into Potential Global Risks, a report from Guy Carpenter is available from The Asian Earthquake/Tsunami Disaster, An Insurance Perspective from Glencairn.