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EQECAT Releases Upgraded Germany Flood Model - Model Provides Sophisticated Tool To Assess River, Non-River Flood Exposure In All Postal Codes

October 3, 2006

Oakland, California

EQECAT, Inc., the authority on extreme-risk modeling, announced today the release of its upgraded Germany Flood model, part of its EuroFlood™ platform, enabling the European and international insurance industry to manage more effectively exposures from river and non-river floods in every postal code across the nation.

“The EQECAT model provides an enhanced and sophisticated tool to the marketplace which has sometimes found financial loss potential of floods in Germany to have been under-estimated, resulting in unexpectedly high loss levels,” said James Webb, EQECAT European product manager. “Moreover, with exposures to floods increasing, the EQECAT model provides the industry with an appropriate tool to assist with accumulation control and underwriting decision-making,” he said.

The upgraded Germany Flood model, as part of EuroFlood product, represents the second generation of the original DACH Flood model development, which was sponsored by Guy Carpenter. This subsequent release for Germany flood is an EQECAT initiative in recognition of the need to include other flood types and to expand the territorial scope of cover.

The EQECAT Germany Flood model includes more than 30,000 events, and takes into account time-of-the-year-dependent base flow, antecedent precipitation, soil-dependent infiltration rates, snowmelt, and defense-structure breaching probabilities.

EQECAT Germany Flood Model Is Fully Probabilistic Tool

The enhanced EQECAT Germany Flood model is a fully probabilistic tool, enabling insurers to assess building asset exposure to almost all flood types across Germany. It covers the major rivers, such as the Rhine, Elbe, Danube, Oder, Weser and Ems, along with an additional 100,000 kilometers of tributaries of those rivers and other river networks, as well as non-riverine flooding. “The non-riverine component was specially developed using a separate hydro-dynamic methodology,” Mr. Webb emphasized. “This component of the model is critical because that kind of flooding can account for significant losses.”

“In addition, the model has been validated by EQECAT against the most current scientific data, and by external flood specialists,” he said.

ABS Consulting’s Expertise Also Played Key Role In Development

The risk engineering expertise of ABSG Consulting Inc. (“ABS Consulting”), the parent company of EQECAT, also played a major role in the development of the vulnerabilities relationships in the model.

“The problem with developing vulnerability relationships is that they are often based too heavily on claims data which can be statistically unreliable. Claims data can be inconsistent and vary according to local market practice and insurer. Before calibrating vulnerabilities against claims data, EQECAT applied ABS Consulting’s empirical engineering data and expertise,” Mr. Webb said.

The upgraded model addresses key requirements facing the insurance industry including: accumulation control, portfolio optimization, pricing adequacy, and capacity allocation needs.

EQECAT’s EuroFlood event set covers Europe from Ireland to Romania, assuring correlation between countries and river basins throughout Europe for future model expansion.

ABSG Consulting Is A Leading Global Provider Of Risk Management Services

ABSG Consulting Inc. is a leading independent global provider of risk management services, combining industry specialists, risk modeling and practical engineering and technology solutions to help business, finance, industry and government manage risk. Through a comprehensive and integrated risk management approach, ABS Consulting is committed to helping clients reduce business interruption and manage catastrophic, operational, and security risks. ABS Consulting is headquartered in Houston, Texas. For additional information, please log on to www.absconsulting.com.

EQECAT Serves Global Clients Through Extensive WORLDCATenterprise™

Through its user-friendly, extreme-risk modeling software, WORLDCATenterprise™, EQECAT enables clients to assess and manage potential damage and loss from wind, earthquakes, flood, wildfire, and terrorism, among other perils. WORLDCATenterprise™ includes 167 natural hazard software models for 88 countries spanning six continents.

EQECAT and its parent ABSG Consulting Inc. (“ABS Consulting”) serve the global property and casualty insurance industry, major multinational corporations and financial institutions. EQECAT is known as the technical leader and innovator in the development of analysis tools and methodologies to quantify insurers’ and major corporations’ exposure to natural and man-made catastrophic risk.

EQECAT was founded in 1994 and is headquartered in Oakland, California. For additional information, please log on to www.absconsulting.com, or www.EQECAT.com.