A recent article entitled “A Seismic Change in Predicting How Earthquakes Will Shake Tall Buildings” that appeared in the New York Times on June 27, has generated some concern regarding the performance of tall buildings during earthquakes. The article cites statements made during the eleventh U.S. National Conference on Earthquake Engineering — which several RMS earthquake engineering experts attended, stating that there are large changes being introduced to ground motion models. Ground motion models predict the intensity of ground shaking at a site.
I invite you to explore the latest digital edition of EXPOSURE Magazine, which also hit the streets of Monte Carlo as a print edition for those attending Les Rendez-Vous de Septembre, and will be available at RMS events over the coming months.
There is a clear mission for EXPOSURE, which is “… to provide insight and analysis to help insurance and risk professionals innovate, adapt and deliver.” And change is in the air for all businesses in the industry, whether it is developing new opportunities, getting products to market faster, being more agile and efficient, or using data-driven insight to transform decision making.
Together with the California Earthquake Authority (CEA), RMS co-hosted a webinar on May 17 for the CEA’s global panel of catastrophe reinsurers to explore how new earthquake science and RMS modeling impacts the CEA and its markets. The CEA is one of the largest earthquake insurance programs in the world with nearly one million policyholders throughout California. In the webinar, we analyzed and shared insights about the risk to the CEA book using the new Version 17 RMS North America Earthquake Models which was just released on April 28.
November 18 marked the 85th anniversary of one of the largest and deadliest earthquakes in Canadian history, one that reiterates the importance of managing all drivers of earthquake risk effectively in the region.
The 1929 Grand Banks earthquake and tsunami was a magnitude 7.2 event that occurred just after 5:00 p.m. NST approximately 155 miles south of Newfoundland and was felt as a far away as New York City and Montreal. The earthquake caused limited damage on land and water, including minor landslides, but triggered a significant tsunami that was recorded as far south as South Carolina and as far east as Portugal.
Sea levels near the Newfoundland coast rose between 6 and 21 feet, with higher amounts recorded locally through narrow bays and inlets, and the tsunami claimed 28 lives. Had this event occurred near a more populated region, such British Columbia or Québec, the impacts could have been much worse.
An event like this shows just how complex the Canadian earthquake risk landscape can be and how important it is to keep that view of risk as up-to-date and accurate as possible. On average, Canada experiences approximately 4,000 earthquakes each year. Most are small, but some can be large, particularly along the west coast near Vancouver and Victoria. There, in what is known as the Cascadia Subduction Zone, the Juan de Fuca plate is sliding underneath North America, causing subduction earthquakes, which tend to be less frequent but more severe than other Canadian seismic sources.
RMS has been modeling Canadian earthquake risk since 1991, with the last model update in 2009. The model inherently or explicitly includes the impacts of nearly all drivers of earthquake damage in that part of the world, from ground shaking, landslides, and liquefaction to fire following.
In building, updating, and validating the model over the years, RMS has collaborated with leading Canadian researchers and engineers, including representatives from what is now known as Natural Resources Canada (NRCan). RMS also maintains strong relationships with key insurance organizations and regulatory bodies, such as the Office of Superintendent of Financial Institutions and the Insurance Bureau of Canada, to play a key role in influencing guidelines and practices throughout the Canadian earthquake market.
The next update to the RMS Canada Earthquake Model is targeted for 2016 as part of a larger RMS North America Earthquake Models update. Among other enhancements, the model will incorporate the latest seismic hazard data (2015), internal research by the RMS seismic hazard development team, and introduce a probabilistic earthquake-induced tsunami model that will include losses from inundation along impacted coastlines.
Together, these updates will reflect the latest view of earthquake hazard in Canada, enabling the market to price and underwrite policies more accurately, and manage earthquake portfolio aggregations more effectively.