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Florida Commission on Hurricane Loss Projection Methodology

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Florida Commission on Hurricane Loss Projection Methodology Submitted: November 5, 2018 Revised: January 21, 2019 Revised: February 13, 2019 Revised: March 22, 2019 Revised: April 9, 2019 Revised: July 12, 2019 HurLoss Version 9.0 Florida Commission on Hurricane Loss Projection Methodology 2017 Hurricane Standards Prepared for: Florida Commission on Hurricane Loss Projection Methodology State Board of Administration 1801 Hermitage Boulevard Tallahassee, Florida 32308 Prepared by: Applied Research Associates, Inc. IntraRisk Division 8537 Six Forks Road, Suite 600 Raleigh, North Carolina 27615 Copyright © 2019 Applied Research Associates, Inc. For Evaluation by the Florida Commission on Hurricane Loss Projection Methodology 1 Applied Research Associates, Inc. April 9, 2019 4 4/9/2019 5:30 PM Florida Commission on Hurricane Loss Projection Methodology Model Identification Name of Hurricane Model: HurLoss Florida Model Hurricane Model Version Identification: 9.0 Interim Hurricane Model Update Version Identification: N/A Hurricane Model Platform Name and Identifications: HurLoss Software Platform Interim Data Update Designation: N/A Name of Modeling Organization: Applied Research Associates, Inc. Street Address: 8537 Six Forks Road, Suite 600 City, State, Zip Code: Raleigh, NC, 27615 Mailing Address, if different from above: N/A Contact Person: Frank Lavelle Phone Number: (919) 582-3350 Fax Number: (919) 582-3401 E-mail Address: [email protected] Date: April 9, 2019 Applied Research Associates, Inc. April 9, 2019 3 4/9/2019 5:30 PM Applied Research Associates, Inc. April 9, 2019 4 4/9/2019 5:30 PM November 5, 2018 Floyd Yager, FCAS Chair, Florida Commission on Hurricane Loss Projection Methodology 1801 Hermitage Boulevard, Suite 100 Tallahassee, FL 32308 Re: ARA Model Submission under the November 1, 2017 Standards Dear Mr. Yager: Applied Research Associates is pleased to submit our hurricane loss projection model for review by the Florida Commission on Hurricane Loss Projection Methodology. The model has been reviewed by professionals having credentials and/or experience in the areas of meteorology, statistics, engineering, actuarial science, and computer/information science, as indicated by the signed Expert Certification Forms G-1, G-2, G-3, G-4, G-5 and G-6. Our submission has been reviewed for editorial compliance, as indicated by the signed Form G-7. Attached to this letter are the Model Submission Checklist and a summary statement of compliance with each individual standard. Enclosed are 7 bound copies of our submission. Electronic copies of our submission can be downloaded from an ARA ftp site. Details regarding accessing this site will be emailed to the Commission. ARA is prepared to review proprietary data, model documentation, model validation, and any additional questions by the Professional Team during their visit. If you have any additional questions regarding this submission, please contact me. Sincerely, Francis M. Lavelle, Ph.D., P.E. Principal Engineer FML/lw Applied Research Associates, Inc. April 9, 2019 5 4/9/2019 5:30 PM Applied Research Associates, Inc. April 9, 2019 6 4/9/2019 5:30 PM Hurricane Model Submission Checklist 1. Please indicate by checking below that the following has been included in your submission to the Florida Commission on Hurricane Loss Projection Methodology. Yes No Item X 1. Letter to the Commission X a. Refers to the signed Expert Certification forms and states that professionals having credentials and/or experience in the areas of meteorology, statistics, structural engineering, actuarial science, and computer/information science have reviewed the model for compliance with the standards X b. States model is ready to be reviewed by the Professional Team X c. Any caveats to the above statements noted with a complete explanation X 2. Summary statement of compliance with each individual standard and the data and analyses required in the disclosures and forms X 3. General description of any trade secret information the modeling organization intends to present to the Professional Team and the Commission X 4. Hurricane Model Identification X 5. Seven bound copies (duplexed) X 6. Link emailed to SBA staff containing all required documentation that can be downloaded from a single ZIP file X a. Submission document and Form A-1, Zero Deductible Personal Residential Hurricane Loss Costs by Zip Code in PDF format X b. PDF submission file supports highlighting and hyperlinking, and is bookmarked by standard, form, and section X c. Data file names include abbreviated name of modeling organization, standards year, and form name (when applicable) X d. Form S-6, Hypothetical Events for Sensitivity and Uncertainty Analysis, if required, in ASCII and PDF format X e. Forms M-1, Annual Occurrence Rates, M-3, Radius of Maximum Winds and Radii of Standard Wind Thresholds, V-2, Hurricane Mitigation Measures and Secondary Characteristics, Range of Changes in Damage, V-4, Differences in Hurricane Mitigation Measures and Secondary Characteristics, A-1, Zero Deductible Personal Hurricane Residential Loss Costs by ZIP Code, A-2A, Base Hurricane Storm Set Statewide Hurricane Losses (2012 FHCF Exposure Data), A-2B, Base Hurricane Storm Set Statewide Hurricane Losses (2017 FHCF Exposure Data), A-3A, 2004 Hurricane Season Losses (2012 FHCF Exposure Data), A-3B, 2004 Hurricane Season Losses (2017 FHCF Exposure Data), A-4A, Hurricane Output Ranges (2012 FHCF Exposure Data), A-4B, Hurricane Output Ranges (2017 FHCF Exposure Data), A-5, Percentage Change in Hurricane Output Ranges, A-7, Percentage Change in Logical Relationship to Hurricane Risk, and A-8A, Hurricane Probable Maximum Loss for Florida (2012 FHCF Exposure Data), and A-8B, Hurricane Probable Maximum Loss for Florida (2017 FHCF Exposure Data), in Excel format X f. Form V-3, hurricane Mitigation measures and Secondary Characteristics, Mean Damage Ratios and Hurricane Loss Costs (Trade Secret Item), Form V-5, Differences in Hurricane Mitigation Measures and Secondary Characteristics, Mean Damage Ratios and Hurricane Loss Costs (Trade Secret Item, and Form A-6, Logical Relationship to hurricane Risk (trade Secret Item), in Excel format if not considered as Trade Secret X 7. All hyperlinks to the locations of forms are functional X 8. Table of Contents X 9. Materials consecutively numbered from beginning to end starting with the first page (including cover) using a single numbering system, including date and time in footnote X 10. All tables, graphs, and other non-text items consecutively numbered using whole numbers, listed in Table of Contents, and clearly labeled with abbreviations defined Applied Research Associates, Inc. April 9, 2019 7 4/9/2019 5:30 PM Yes No Item X 11. All column headings shown and repeated at the top of every subsequent page for forms and tables X 12. Standards, disclosures, and forms in italics, modeling organization responses in non-italic X 13. All graph and maps conform to guidelines in II. Notification Requirements A.4.e. X 14. All units of measurement clearly identified with appropriate units used X 15. All forms included in submission document appendix except Trade Secret Items. If forms designated as a Trade Secret Item are not considered as trade secret, those forms are to be included in the submission appendix X 16. Hard copy documentation identical to the electronic version X 17. Signed Expert Certification Forms G-1 to G-7 X 18. All acronyms listed and defined in submission appendix 2. Explanation of “No” responses indicated above. (Attach additional pages if needed.) Form S-6 is not required HurLoss 9.0 11/5/2018 Model Name Modeler Signature Date Applied Research Associates, Inc. April 9, 2019 8 4/9/2019 5:30 PM ARA Summary Statement of Compliance Standard Standard Met? General Standards G-1 Scope of the Hurricane Model and Its Implementation Yes G-2 Qualifications of Modeling Organization Personnel and Consultants Engaged in Yes Development of the Hurricane Model G-3 Insured Exposure Location Yes G-4 Independence of Hurricane Model Components Yes G-5 Editorial Compliance Yes Meteorological Standards M-1 Base Hurricane Storm Set Yes M-2 Hurricane Parameters and Characteristics Yes M-3 Hurricane Probability Distributions Yes M-4 Hurricane Windfield Structure Yes M-5 Hurricane Landfall and Over-Land Weakening Methodologies Yes M-6 Logical Relationships of Hurricane Characteristics Yes Statistical Standards S-1 Modeled Results and Goodness-of-Fit Yes S-2 Sensitivity Analysis for Hurricane Model Output Yes S-3 Uncertainty Analysis for Hurricane Model Output Yes S-4 County Level Aggregation Yes S-5 Replication of Known Hurricane Losses Yes S-6 Comparison of Projected Hurricane Loss Costs Yes Vulnerability Standards V-1 Derivation of Building Hurricane Vulnerability Functions Yes V-2 Derivation of Contents and Time Element Hurricane Vulnerability Functions Yes V-3 Hurricane Mitigation Measures and Secondary Characteristics Yes Actuarial Standards A-1 Hurricane Modeling Input Data and Output Reports Yes A-2 Hurricane Events Resulting in Modeled Hurricane Losses Yes A-3 Hurricane Coverages Yes A-4 Modeled Hurricane Loss Cost and Hurricane Probable Maximum Loss Level Yes Considerations A-5 Hurricane Policy Conditions Yes A-6 Hurricane Loss Outputs and Logical Relationship to Risk Yes Computer Standards C-1 Hurricane Model Documentation Yes C-2 Hurricane Model Requirements Yes C-3 Hurricane Model Architecture and Component Design Yes C-4 Hurricane Model Implementation Yes C-5 Hurricane Model Verification Yes C-6 Hurricane Model Maintenance and Revision Yes C-7 Hurricane Model Security Yes Applied Research Associates, Inc. April 9, 2019 9 4/9/2019 5:30 PM Applied Research Associates, Inc. April 9, 2019 10 4/9/2019 5:30 PM ARA Checklist Item 3 Item 3. General description of any trade secrets the modeling organization intends to present to the Professional Team. The Professional Team will be shown documentation binders, validation studies and supporting information related to the model changes listed in our response to Disclosure 5 under Standard G-1. Any other materials will be dependent upon requests or suggestions from the Professional Team.
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