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Determining the time horizon of your hazard assessment determines the level of hazard of any particular event. 

The shorter the time period of your assessment, the less probable and therefore the less hazardous infrequent events will be.  More frequent events will become more important to the hazard analysis.  If your community suffers a significant earthquake every 100 years, but you have a major hazardous materials spill on average every 6 months, the spill is a higher hazard in a 2 year horizon. 

As the time period increases, infrequent events become more of a hazard.  In a 100 year horizon, probabilities  indicate that it is highly probable you will experience a 100 year flood (a flood of a magnitude that typically occurs once in a 100 year period).  And if that horizon is extended to 500 years, a 500 year flood becomes probable.  In general, as events increase in magnitude and intensity toward the catastrophic end of the scale, the frequency of occurrence diminishes.