Normal Approximation for Fire Incident Simulation using Permanental Cox Process

Estimating the number of natural disasters benefits the insurance industry in terms of risk management. However, the estimation process is complicated due to the fact that there are many factors affecting the number of such incidents. In this work, we propose a Normal approximation technique for associated point processes for estimating the number of natural disasters under the following two assumptions: 1) the incident counts in any two distinct areas are positively associated and 2) the association between these counts in two distinct areas decays exponentially with respect to distance outside some small local neighborhood. Under the stated assumptions, we extend previous results for the Normal approximation technique for associated point processes, i.e., the establishment of non-asymptotic L1 bounds for the functionals of these processes. Then we apply this new result to permanental Cox processes that are known to be positively associated. Finally, we apply our Normal approximation results for permanental Cox processes to Thailand’s fire data from 2007 to 2020, which was collected by the Geo-Informatics and Space Technology Development Agency of Thailand.