Probable maximum loss

A credible spill for Probable Maximum Loss Potential. The minimum spill source is the largest process vessel. The maximum spill size is the combined contents of the largest process vessel, or train of process vessels connected together if not readily isolated. Between these extremes, a credible spill may be estimated after taking into account the presence of remotely operated shutoff valves adequate for an emergency, and automatic dump or flare systems. 

Normal loss prevention practices are to design protection measures for the worst case fire event that can occur at the facility. To interpret this literally would mean that an oil or gas facility is completely on fire or totally destroyed by an explosion. Practical, economical and historical review considerations indicate this rational should be redefined to the Worst Case Credible Event (WCCE) or the as referenced in the insurance industry, the Probable Maximum Loss (PML), that could occur at the facility. 

A fire loss that occurs with one active fire protection system out of service, often described as the Probable Maximum Loss (PML). 

Process areas with a probable maximum loss of less than X do not require automatic suppression systems. 

A term used in the insurance industry that is normally defined as the worst case scenario under which an estimate is made of the maximum dollar amount that can be lost if a catastrophe occurs such as a hurricane or firestorm. See also Probable Maximum Loss (PML). 

In the petroleum and chemical industries, insurance industry surveyors as part of their evaluations typically independently estimate the probable maximum loss (PML) a facihty may sufier by performing a calculation of the most harmful catastrophic event that may occur at the installation. A potential vapor cloud explosion at the facihty (where this is applicable) is usually the event that is considered. By examining such high loss potentials, i.e., the PMLs, the maximum risk level can be determined and therefore the insurance coverages that are necessary can be defined, based on this evaluation. As an example, the largest isolatable volatile hydrocarbon inventory for a process unit is identified, the vapor cloud potential is estimated, and by determining the explosive overpressures and resultant damage, a loss estimate for the replacement value of equipment is determined, and therefore the insurance rate for this exposure can be determined. 

There is no universally accepted definition of probable maximum loss (PML) for purposes of earthquake risk analysis, but it is often understood to mean the loss with 90 % nonexceedance probability given shaking with 10 % exceedance probability in 50 years. For a single asset, PML can be calculated from the seismic vulnerability function by inverting the conditional distribution... 

The numerical estimates from CAT models make it possible to calculate the frequency of loss, which is expressed in the industry as an exceedance probability curve or EP curve, a relationship between the value at risk and its probability. This information is critical to price an insurance policy or a reinsurance contract. The pure premium of an insurance policy is defined as its associated average annual loss, and solvency requirements are often expressed as probable maximum losses at specific return periods, typically at 100 years or 250 years. 

Maximum loss in a year due to floods at 80% confidence level. Probability that the annual loss due to floods exceed 4 million. Probability that the annual loss is between 2 and 3 million. 

The net index is used with correlations provided to determine the maximum probable property damage and business intermption loss in the event... 

The goals of the F EI are to raise awareness of loss potential and identify ways to reduce potential severity and potential dollar loss in a cost-effective manner. TLe index number has significance as a comparison and in calculations to estimate the maximum probable property damage (MPPD). It also provides a method for measuring tbe effect of outage (plant being shut down) on the business. It is easy for users to get credible results with a small amount of training. 

For maximum temperatures below 800°F, suitable ferritic steels are usually good selections. Above 800°F their loss of strength must be considered carefully and balanced against their lower thermal expansion. It should be recognized that if they are heated through the ferrite to austenite transformation temperature their behavior will become more complex and the results probably adverse. 

Example 21.8 The meat-cooling load in Example 21.2 is probably a daily batch from an abattoir and the duty will be less at night, once the meat is cooled. The maximum capacity will therefore be 10.3 kW, plus the fans and other room losses, and the plant will run continuously while the meat is being chilled only. 

The Maximum probable property damage (MPPD) is then calculated by multiplying the Base MPPD by a Credit control factor. The Loss control credit control factors, see Table 9.6, allow for the reduction in the potential loss given by the preventative and protective measures incorporated in the design. 

After reaching its maximum productivity (after ca. 8 hours.) the [Gl]-Nii2 showed a fast deactivation when applied in continuous catalysis performed in a membrane reactor (Figure 4.12). The fast loss of activity cannot be due to a lack of retention of the catalyst. Due to the high retention measured, this process should be much slower. A model study revealed that this deactivation process probably takes place by the formation of insoluble Ni(III) species (see Section 4.5 for further details). 

---