An article in the 18 August Eos explored an obscure connection that ties experts in earthquakes and other disasters to the insurers that handle their risks. The connection is that financial experts and geophysicists need to talk to each other in order to create "catastrophe bonds" for, say, insuring a stadium against hurricane damage. Financially, cat bonds are intriguing because, one analyst says, "cat bond prices are relatively immune to general market sentiment (bull and bear markets)."
Experts who speak both finance and geophysics are needed. The article's authors say the right person must combine geoscience and modern finance. "These disciplines are similar in their reliance on applied probability, which should make it straightforward to combine them into a coherent program." As the market for cat bonds grows (and it's growing by roughly one-third each year), these experts will earn degrees and schools will arise to train them. Might you be one? The article is copied here and the lead author, James Elsner of Florida State University, keeps up the modest Hurricane Climate blog.
Mapping ancient hurricanes
How a quake brought down a state insurance commissioner
Prepare for earthquakes
National landslide insurance?
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