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MEETING THE GROWING NEED FORTALENT IN CATASTROPHE MODELING& RISK MANAGEMENT

The increased focus on catastrophe risk management by corporate boards,executives, rating agencies, and regulators has fueled a growing need for skilledcatastrophe modelers. New regulatory regimes around the world require companies todemonstrate robust risk management practices and a comprehensive understanding ofthe modeling process and associated assumptions and uncertainties. That’s why AIRWorldwide established the AIR Institute, with the mission to be a center of excellencefor catastrophe risk management training and education.At the core of the Institute is the Certified Catastrophe Modeler Program, an intensiveand interactive program designed to prepare the next generation of modelers fortomorrow’s risk management challenges. More than just end-user training, theProgram explores the inner workings of the models, delving into such topics as cataloggeneration, accounting for uncertainty, advanced analysis options, and interpretingmodel results.Upon successful completion of the coursework and final exam, attendees become AIRInstitute Certified Catastrophe Modelers (CCM ), immediately prepared to addeven more value to their organizations.

CATASTROPHE RISK MANAGEMENT PROFESSIONALS COMPLETING THE PROGRAM GAIN:–– A more detailed understanding of the science andtechnology underlying the models–– Improved preparation for discussions with rating agencies–– Practical expertise with AIR’s software applications,–– S kills in handling and optimizing the exposure dataentering the models and software–– An appreciation of the impact of exposure data quality onthe accuracy of modeled results–– In-depth knowledge of the nature of analysis options andassumptions and their impact on model results–– Efficiency in importing and exporting data and optimizinganalysis run-times–– Ability to apply best practices in gathering and interpretingthe output of model analysisincluding modeling of complex business situations–– T he background necessary to synthesize and communicateanalysis results to senior managementTHE BOTTOM LINE: An AIR Institute Certified CatastropheModeler will have the necessary tools to employ andcommunicate best practices in catastrophe managementthroughout organizations concerned with risk.“ Given the importance of catastrophe modelling within the insurance industry, Ifeel this course has enabled me to further understand—and even challenge—theAIR models in a more meaningful way.”DAN SPENCE, AGGREGATE MANAGER, ASCOT UNDERWRITING LTD.WHO SHOULD ATTEND?Anyone with responsibility for catastrophe risk analysis,management, and decision-making will benefit from the CCMProgram, including:–– Insurance financial managers–– Actuaries–– Underwriters–– Catastrophe modeling managers and analysts–– Insurance and reinsurance brokers–– RegulatorsADDITIONAL BENEFITS TO ATTENDEES–– Recognition as an AIR Institute Certified CatastropheModeler (CCM)–– Eligibility for Continuing Professional Development creditsfrom:–– American Institute for Chartered Property CasualtyUnderwriters (CPCU)–– American Academy of Actuaries (AAA)BENEFITS OF EMPLOYING CERTIFIED MODELERS–– Better data quality control and validation to supportinternal and external catastrophe analysis–– Improved efficiency and throughput in the catastrophemodeling function–– Fuller scrutiny of sensitivity of the results to changes inmodeling data and analysis assumptions–– New insights as modeling capabilities extend to morecomplex business and financing scenarios–– Crisper and clearer communication of the majorconclusions regarding catastrophe risk

CCM PROGRAM DETAILSPROGRAM STRUCTUREThe CCM Program’s core curriculum consists of five fulldays of classroom learning. A mix of lectures, interactivedemonstrations and hands-on exercises with AIR models andsoftware will bring each of these topics to life for certificationcandidates.The Program assumes prior knowledge of catastrophemodeling and the AIR software. Students who are unfamiliarwith either of these, or who have never attended an AIRsoftware training session, will be asked to complete a smallnumber of prerequisite classes offered as online (on-demand)tutorials. These are designed to introduce the student tocatastrophe modeling in general and AIR software in particular,and will help ensure that all attendees arrive with a suitablelevel of background knowledge.Following the week-long core session, students will berequired to take at least three elective sessions, which may beoffered at AIR Client Conferences and via other media. Theseare designed to allow attendees to tailor their educationalexperience to suit their interests and needs, and to delvedeeper into selected topics than is possible during the five daysof classroom learning.A comprehensive final exam will assess students’understanding of the Program material.1PREREQUISITECLASSESAvailable yearround2CORECLASSESFive days of classroomlearning, offered at AIRoffices several timesa year3ELECTIVECLASSESOffered atAIR Conferencesand via othermediaFACULTYEach unit of the core curriculum is led by a senior AIRprofessional experienced in the relevant topics, many withPhDs in their fields. Instructors are supported by teachingassistants offering on-demand one-on-one tutorial support forthe lectures and exercises. Periodic quizzes are also completedwith faculty assistance to reinforce learning and retention.LOGISTICS AND HOSPITALITYBreakfast and lunch are provided on each of the five classroomdays, with a welcome reception on Monday and a celebrationdinner on Thursday. Dress code is casual. It is recommendedthat attendees arrive Sunday night and depart late afternoonor evening on Friday, as each day’s activities begin at 9 a.m.and end about 6 p.m. local time.CCM4EXAMOffered byappointment at AIRConferences or atAIR offices aroundthe worldPROGRAM STRUCTURE

CLASSESPREREQUISITE CLASSESOffered online, these sessions address the key concepts thatstudents need to understand before attending the core classes.INTRODUCTION TO CATASTROPHE MODELINGThis session introduces Institute participants to key conceptsunderlying catastrophe models and modeling. We considerthe history of the industry, the high-level framework of acatastrophe model, and the motivation for using models.The class also examines the current state of the catastrophemodeling industry and its likely future direction.INTRODUCTION TO TOUCHSTONE This session provides an introductory-level tutorial on detailedloss analysis. It introduces the Touchstone user interface andexplains the various screens and their contents. The sessionguides users through a typical loss analysis process, includingthe import of exposure data, assigning latitudes and longitudesto each exposure location, running the analysis, and exportingand interpreting the results. This class sets the scene for theProgram’s in-depth “Touchstone Under the Hood” class, whichis offered as a core module.INTRODUCTION TO CATRADER This session provides an introductory-level tutorial on the useof CATRADER for aggregated loss analysis. It introduces theCATRADER user interface and guides users through a typicalloss analysis process, including the import of aggregatedexposures and loss files, running the analysis, and exportingand interpreting the results. This class provides the backgroundknowledge required for the Program’s core “CATRADER UnderThe Hood” class.The knowledge gained from these classes will be assessedby way of an online test. A passing grade is a prerequisite toattending the core and elective sessions.CORE CLASSESThe centerpiece of the Program is the core curriculum – fivedays of classroom learning delivered at one of AIR’s offices.The curriculum covers the material that all CCMs should beexpected to know, and provides the springboard for studentsto explore the elective classes. A list of the core classes,together with an overview of their contents, is on the overleaf.ELECTIVE CLASSESA number of sessions at each AIR Conference will bedesignated as “AIR Institute Program Electives.” They willreflect the latest developments in the science behind themodels and other aspects of catastrophe modeling. Studentsmust take at least three elective classes, and the knowledgegained will be assessed as part of the final CCM Programexam.

CORE CLASSESINTRODUCTION TO HURRICANE MODELINGParticipants will learn about hurricane meteorology and how keyvariables are used to generate stochastic events. Storm intensityfootprints, the impact of terrain on storm intensity, and therelationship between storm duration and fatigue failure will allbe explored. The session will also discuss the impact of climatechange and the uncertainty surrounding the quantification of itsimpact on landfall frequency and insured losses.INTRODUCTION TO EARTHQUAKE MODELINGWhy and where do earthquakes occur? How big are they likelyto be? Why do they sometimes cause damage and sometimesnot? What buildings are more vulnerable and why? This sessionexamines the nature of earthquakes and the physical behaviorof buildings subjected to ground motion. The topics covered willdescribe the AIR earthquake modeling process, from the analysisof historical seismicity, stochastic catalog generation, and theattenuation of seismic waves to the development of buildingdamage functions, the analysis of secondary vulnerabilities suchas soft-stories or corner buildings, and the estimation of loss.Through interactive exercises and in-classroom demonstrations,the participants will acquire an understanding of the earthquakemodeling process, its challenges and its limitations. This sessionwill also discuss the two major determinants of the damagecaused by a tsunami and the effect of terrain on tsunamipropagation.INTRODUCTION TO EXTRATROPICAL CYCLONEMODELINGParticipants will learn about where extratropical cyclones, orETCs, form and the meteorological conditions that facilitatetheir development. This session will also investigate the primaryenergy sources that fuel ETCs and will explore the similaritiesand differences between ETCs and tropical cyclones. Participantswill also gain insight into the methodology used to build AIR’sstochastic catalog of storms.INTRODUCTION TO SEVERE THUNDERSTORM MODELINGThis session examines the three sub-perils (tornadoes, hail, andstraight-line winds) that constitute a severe thunderstorm andthe physical behavior of buildings subjected to these sub-perils.The topics covered include: the severe thunderstorm modelingprocess, from the “smart-smoothing” of the historical dataset from NOAA’s Storm Prediction Center; the generation ofthe stochastic catalogs; the 3-second gust wind speed and hailimpact energy to the development of building damage functions;the analysis of secondary vulnerabilities such as roof age, pitch,covering, and attached structures; and the estimation of loss.INTRODUCTION TO INLAND FLOOD MODELINGThis session examines the nature of flood and the physicalbehavior of buildings, contents, and nonstructural componentssubjected to this peril. The session will cover the AIR inlandflood modeling process, including: the simulation of realisticprecipitation patterns, methodology for determining floodinundation depth, and simulation of levee failure. The session willalso discuss how AIR defines a flood event; the component-basedapproach to the development of building damage functions;individual risk modifiers, such as foundation type (includingbasements) and contents vulnerability; and estimation of loss.ATMOSPHERIC PERILS VULNERABILITYParticipants will learn how vulnerability functions are developedto create ground-up hurricane, severe thunderstorm, andextratropical cyclone losses. The impact of exposure characteristicson loss calculations will also be examined.