Two catastrophe modeling firms are set to release comprehensive updated versions of their hurricane models this year as catastrophe models continue to incorporate the latest technology and scientific data.

Boston-based AIR Worldwide Corp. and Newark, Calif.-based Risk Management Solutions Inc. say they have been working to develop state-of-the-art capabilities and enhancements to their models.

In addition, because every catastrophe event is viewed as an opportunity to calibrate the models, the enhancements incorporate the latest data collected from recent events including the active storm season of 2008—where teams have been able to study how structures performed in the damaged regions and conduct post-event claims analysis to refine the model's vulnerability functions, experts say.

AIR's version 12.0 U.S. hurricane model incorporates recent research in atmospheric science to more accurately estimate wind speed, said Peter Dailey, director of atmospheric science in Boston.

Researchers have been able to gain an improved knowledge of what AIR describes as the 4-D structure of hurricanes, including the storm's evolution, its radial wind profile, the relationship between winds aloft and at the surface, and how long the winds will blow, “enabling us to model wind fields with unprecedented accuracy” Mr. Dailey said.

Aside from maximum wind speed, other enhancements include various characteristics of a storms' strength such as its geographic distribution and how quickly it dissipates once it makes landfall, which helps forecast if a storm is severe enough to produce “inland penetration,” he said.

Hurricane Ike—a Category 4 storm that hit Galveston, Texas, in September 2008 and went on to produce record losses in Ohio—served as a costly reminder of inland penetration dangers, he said.

Meanwhile, RMS said its updated hurricane models will include high-resolution, powerful storm surge modeling capability to help determine the impact of coastal flooding associated with hurricanes.

“We're getting very detailed about understanding the interface between the storm surge and the wave action, because it's the combination of surge and wave action which is so important both for offshore platforms and coastal properties in terms of determining whether” they survive an event, said Robert Muir-Wood, RMS' London-based chief research officer.

RMS also has been developing enhanced tools for reinsurers to measure the quality of the exposure data that is being supplied by insurers.

Meanwhile, new visualization tools are being incorporated into AIR's new model to “help connect the decision-makers to science,” Mr. Dailey said. Using enhanced software tools and a free Google Earth application, users can view an animated simulation of a storm's history and future projections.

Climate change also is a big area of focus, and catastrophe modeling firms have been working to incorporate the latest scientific data to reflect the potential impact of climate change. So far, this data is reflected in the near-term models that were developed in 2006 to predict U.S. Atlantic hurricane losses during the next five years.

“We've spent a lot of time looking at the National Hurricane Center science and we agree with their identification of cycles in history, where there have been warmer and more active seasons. Right now, we are currently in warm-water cycle and we do want to help our clients understand the sensitivity, and understand what the risks of doing business in the next few years may be,” said Thomas Larsen, senior vp, product management group, for Oakland, Calif.-based EQECAT Inc. Although the near-term models have faced some criticism for overestimating losses last year, EQECAT's near-term model is offered as an alternate product, “to provide an alternate view,” he said.