Research on Risk and Value Assessment under Extreme Conditions Based on Analytic Hierarchy Process and Delphi Method

Abstract

With global climate change worsening, the property insurance sector faces growing challenges from increasingly severe extreme weather events. This paper pinpoints four key factors influencing insurance decision-making: disaster frequency, damage severity, consumer price index, and population dynamics. Analyzing data from ten countries, including China and the U.S., from 2014 to 2023, we establish a hierarchical evaluation model to assess these factors' correlations. Results show risk magnitudes of 0.925 for the U.S. and 0.982 for China, suggesting potential opportunities for insurance underwriting amid extreme weather. Using hierarchical analysis and the Delphi method, we assign weights to factors, identifying buildings scoring above three points as valuable and those with environmental indicator scores below 1.5 as needing protection. This approach aids in evaluating building value and protection requirements, assisting insurers in crafting informed risk management strategies.