ABSTRACT
Extreme events such as hurricanes, floods or droughts continue to preoccupy communities, governments and policy makers around the world. A major concern is the big gap existing between economic losses and insured losses, causing important economic disruptions affecting mostly poor regions of the planet. The possibility to quantify risks associated with weather-related hazards and the potential economic or human losses can become a great tool to understand the final impacts of these hazards on the exposed assets and population. One important methodological limitation of this approach is the proper quantification of risk and the different approaches used by different practitioners. In many situations risk is defined in terms of the hazard only and its probabilistic nature; while in other cases risk is defined in terms of the probability of losses. This chapter presents a conceptual framework to combine the determinant factors of risk: hazard, exposure, and vulnerability to weather-related hazards. The main goal is to quantify risk to extreme events for a specific location and period. There have been many studies about each of these components. We discuss some of the existing approaches and describe our approach by presenting two examples on its application.
