Risk Scoring Methodology

1. Assessment Overview

ClimaInsight rates climate physical risk for Canadian properties across three hazard types: flood, wildfire, and heat stress. Each property receives a rating on a consistent five-level categorical scale for every assessed hazard, plus a single composite rating that aggregates across all selected hazards.

Ratings are derived entirely from Canadian federal geospatial datasets published by Natural Resources Canada (NRCan), the Canadian Forest Service, and Environment and Climate Change Canada (ECCC). They are designed for screening-level portfolio assessments — fast, consistent, and transparent, because every input is traceable to a named federal publisher.

2. Assessment Pipeline

Every assessment follows the same three-step pipeline:

1. Geocoding — Resolve inputs to geographic coordinates. Free tier uses postal-code centroids; Pro tier geocodes full Canadian street addresses.
2. Hazard Overlay — For each location and each selected hazard, sample the corresponding federal hazard dataset at the geocoded coordinate.
3. Risk Rating — Translate the underlying hazard data into a five-level risk category, then derive a composite rating and portfolio summary.

3. Geocoding

ClimaInsight offers two tiers of geographic precision:

• Postal-code geocoding (Free tier) — A two-tier lookup: exact 6-character postal code against a national reference table, falling back to the Forward Sortation Area (FSA, first 3 characters) centroid when an exact match is unavailable.
• Address-level geocoding (Pro tier) — Full Canadian street addresses resolved via a commercial geocoding service, with the postal-code geocoder as a fallback.

4. Flood Risk

Flood risk is rated using the Natural Resources Canada (NRCan) Flood Susceptibility Index (FSI), a national raster dataset that classifies all land in Canada into six susceptibility classes based on hydrological, topographic, and land-cover factors.

For each property, ClimaInsight samples the FSI raster at the geocoded coordinate, reprojecting as needed between the raster's native Canadian projection (EPSG:3979 / NAD83 CSRS Canada Atlas Lambert) and the input coordinate system. The underlying FSI class is then translated into one of ClimaInsight's five standard risk categories.

5. Wildfire Risk

Wildfire risk is rated using ClimaInsight's National Wildfire Risk Index (NWRI), a purpose-built composite built from multiple federal Canadian wildfire datasets and published at 250-metre national resolution. Unlike simple zone-based approaches, the NWRI varies continuously across the landscape — capturing differences even within a single community.

What goes into the NWRI

The NWRI is a governance-reviewed weighted composite of four nationally consistent input layers, each drawn from a federal Canadian source:

• Fuel intensity — Vegetation flammability derived from the Canadian Forest Fire Behaviour Prediction (FBP) fuel-type classification. Conifer-dominated landscapes rate highest; deciduous forest, agricultural land, and urban/water areas rate lowest.
• Historical burn frequency — How often each location has burned in the national fire record. Areas with repeated burns tend to reliably produce fire again.
• Proximity to past burns — Distance to the nearest historical fire perimeter, reflecting that the wildland-urban interface zone close to recently burned landscapes carries elevated ignition and ember exposure.
• Fire weather climate — Long-term Fire Weather Index normals indicating how many days per year a region experiences fire-conducive weather.

These four layers are combined into a single continuous index using a weighted composite, and the index is then translated into ClimaInsight's five-level risk categories. The component set and weighting are reviewed on an annual governance cycle against the Canadian National Fire Database to keep the composite calibrated to observed fire activity.

6. Heat Stress Risk

Heat stress risk is rated using a national raster dataset derived from the CMIP6 Humidex projections, bias-corrected and statistically downscaled against ERA5-Land reanalysis and published by Environment and Climate Change Canada (ECCC). The dataset provides projected annual days with daily maximum humidex > 35 — Health Canada's "high danger" heat threshold.

ClimaInsight uses the SSP2-4.5 emissions pathway (moderate scenario), the 2041–2060 projection period, and the 50th-percentile ensemble median across 19 CMIP6 climate models. The raster resolution is approximately 10 km across all of Canada.

For each property, ClimaInsight samples the heat raster at the geocoded coordinate and translates the underlying class into one of the five standard risk categories.

7. Risk Categories

ClimaInsight uses a consistent five-level categorical rating scale across every hazard type and for the composite rating. This keeps results comparable across hazards and properties, and easy to communicate in reports and dashboards.

8. Composite & Portfolio Rating

Per-property composite rating

When a property is assessed against multiple hazards, its composite rating is the highest category across all selected hazards. A property in a Very High flood zone is Very High overall, regardless of its wildfire or heat ratings.

This reflects how portfolio risk actually manifests: a single severe hazard is sufficient to drive loss. Averaging would understate risk by diluting a severe rating with unrelated benign hazards.

Portfolio-level summary

For assessments covering multiple properties, ClimaInsight produces:

• Category distribution — count of properties in each of the five risk categories.
• Per-hazard breakdown — for each assessed hazard, the distribution of property ratings and the count of properties in the highest-risk categories.
• Portfolio rating — a single aggregate category summarising the portfolio.

9. Data Sources & Governance

Every input used in ClimaInsight ratings is drawn from a named authoritative Canadian federal source. Nothing is scraped, crowdsourced, or inferred from unpublished data.

Governance & updates

• Data sources are reviewed against their authoritative publishers on an annual governance cycle.
• The NWRI composite (inputs, weights, classification thresholds) is reviewed annually against the Canadian National Fire Database to keep the rating calibrated to observed fire activity.
• Methodology changes are versioned; Pro users receive a detailed changelog with each update.

10. Limitations & Intended Use

• Screening-level: ClimaInsight is built for portfolio screening and prioritisation. It is not a substitute for site-specific engineering assessments, hydraulic flood modelling, or insurance underwriting, and it is not a regulatory disclosure or audit product.
• Geocoding precision: Free-tier ratings reflect the postal-code centroid, not a specific building. Address-level precision is available in the Pro tier.
• Dataset vintage: Hazard datasets represent conditions at their time of publication and do not reflect future infrastructure, land-use, or mitigation changes.
• Climate scenario: Heat projections use a single published emissions scenario (SSP2-4.5) and time slice (2041–2060). Alternative scenarios may produce different results.
• Canadian coverage: All datasets are Canada-specific. Locations outside Canada return no data.