Local mitigation strategy (LMS) - Volusia County Government

SECTION 6: VULNERABILITY ASSESSMENTThis approach is illustrated graphically in Figure 6.3. For other hazards where the statistical approach wasused, the computations are based primarily on the observed historical losses.Figure 6.3: Graphical Representation of the Annualized Loss MethodologyThe economic loss results are presented here using two interrelated risk indicators: Annualized Loss andAnnualized Loss Ratio. The Annualized Loss is the estimated long-term weighted average value of lossesto property in any single year in a specified geographic area (i.e., municipal jurisdiction). The AnnualizedLoss Ratio expresses estimated annualized loss normalized by assessed building value.The estimated Annualized Loss (AL) addresses the key idea of risk: the probability of the loss occurring inthe study area (largely a function of building construction type and quality). By annualizing estimatedlosses, the AL factors in historic patterns of frequent smaller events with infrequent but larger events toprovide a balanced presentation of the risk. The Annualized Loss Ratio (ALR) represents the AL as afraction of the assessed value of the local inventory. This ratio is calculated using the following formula:ALR = Annualized Losses / Total ExposureThe ALR gauges the relationship between average annualized loss and assessed values. This ratio can beused as a measure of vulnerability in the areas and since it is normalized by assessed value, it can bedirectly compared across different geographic units such as metropolitan areas, counties ormunicipalities.Loss estimates provided in this vulnerability assessment are based on best available data, and themethodologies applied result in an approximation of risk. These estimates should be used to understandVolusia County Multi-jurisdictional Local Mitigation StrategyFebruary 20106:6