Abstract
Flood risk bias introduced through the traditional method of flood frequency analysis can distort the assessment of flood insurance premium, the fair actuarial rate of flood insurance, even though the insurance payout is maintained the same. The extent of this statistical bias is examined through the concept of expected probability analysis.
To assist in the analysis of flood risk bias, a multi-state: insurance is developed, based on some of the basic assumptions of the two-state insurance model developed by Lippman and McCall.
This is a preview of subscription content, log in via an institution.
Buying options
Tax calculation will be finalised at checkout
Purchases are for personal use only
Learn about institutional subscriptionsPreview
Unable to display preview. Download preview PDF.
References
Beard, L.Rl, 1978. Impact of hydrologic uncertainties on flood insurance. Journal of Hydrau. Div., Am. Soc. Civil Eng., V.104, No.HY11, Nov. pp. 1473–1484.
Hardison, C.H. and M.E. Jennings, 1972. Bias in computed flood risk. Journal of Hydrau.Div., Am. Soc. Civil Eng., V. 98, No. HY3, March, pp. 415–427.
Lippman, S.A. and J.J. Mall, 1981. The economics of uncertainty, ch:6 in Ed. K.J. Arrow and M.D. Intriligator, “Handbook of Mathematical Economics”, North Holland Publishing CO., N.Y., pp230–232.
Stedinger, J.R., 1983. Design events with specified flood risk. Water Resources Research, V.19, No.2. pp. 511–522.
Author information
Authors and Affiliations
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 1987 D. Reidel Publishing Company, Dordrecht, Holland
About this paper
Cite this paper
Tai, K.C. (1987). Flood Risk Bias Analysed through a Multi-State Flood Insurance Model. In: Singh, V.P. (eds) Application of Frequency and Risk in Water Resources. Springer, Dordrecht. https://doi.org/10.1007/978-94-009-3955-4_29
Download citation
DOI: https://doi.org/10.1007/978-94-009-3955-4_29
Publisher Name: Springer, Dordrecht
Print ISBN: 978-94-010-8254-9
Online ISBN: 978-94-009-3955-4
eBook Packages: Springer Book Archive