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Catastrophe Risk terms
Hurricanes, quakes and modeled loss.
Catastrophe modelSoftware that simulates thousands of hurricanes, earthquakes and other disasters against a portfolio of locations to estimate insured losses and odds.Probable maximum loss (PML)An estimate of the largest loss a location, portfolio or event is likely to produce, used to set limits, size reinsurance and satisfy lender requirements.Terrorism Risk Insurance Act (TRIA)The 2002 federal law, run by Treasury, that backstops insurers' losses from certified terrorist attacks and requires them to offer terrorism coverage.