Quantifying the Unknown
By Mark Ellis, James Rosewitz, and Sam Cooper
While there are indeed many unknowns at play when bracing for an earthquake (or other natural catastrophe), there are also quantifiable expectations of what may happen to buildings or other assets. Whether a client is looking to assess a single property before buying, trying to decide what level of insurance to buy for their whole portfolio, or wanting to physically mitigate the risk, an engineering-based risk assessment can provide valuable information about potential earthquake losses and options for retrofit/mitigation. These studies can shed light on future damage, life safety risks, emergency response needs, and the extent of downtime following earthquakes and other natural disasters, enabling a client to understand and confidently manage their risks.
The insurance industry has loss analysis models for quantifying losses for large portfolios, but an owner or corporation often wants a more site-specific and transparent engineering-based approach. Holmes uses engineering expertise and real-world experience from past events, combined with state-of-the-art hazard and loss models to rigorously assess and mitigate risks to:
– Equipment and Plant
– Business Interruption
Our roots are in earthquake and fire risk, however we also have expertise and experience in hurricane, flood, and other natural hazards.
Safety, Downtime and Retrofit/Mitigation Considerations
In addition to loss estimates, many clients want a deeper dive, including a more specific understanding of the risks associated with buildings or assets, as well as retrofit and other mitigation options. For example a tech company or industrial client may want to identify high risk building(s) and equipment at their headquarters or key production and distribution facilities. Downtime may be a critical concern. For a university campus, the focus may be on understanding potential life safety issues and mitigation options, to incorporate into future renovation projects and master planning.
For these types of studies a phased approach is typically used, where Phase 1 is to assess the overall risk for all key components and identify general mitigation approaches, and Phase 2 then dives deeper into the mitigation options for high risk items. Phase 3 can include the actual design and implementation of selected retrofit or mitigation measures.
Typical deliverables can include a facility loss estimate as well as a ranking or grouping of buildings by safety risk (or downtime), and options for retrofit/mitigation of high-risk buildings, equipment and infrastructure.
A “Top Down” Approach
For some clients, it makes sense to start at an even higher/broader elevation than the portfolio loss analysis described first above. For example, a client may own or be investing in a range of assets across the globe that are exposed to varying natural hazards. For these situations, a simple approach is to start by identifying the relative levels of hazard in each location where the client has exposure. This can incorporate best in class hazard data from expert sources in the USA and around the world.
Once key locations with high hazards are identified (including a heat map), a targeted approach can be used to further assess the risks, including estimating losses if desired, and/or developing mitigation options. Further information on Top Down approaches can be provided on request.
Develop a better understanding of the risks to your assets and manage them with confidence.
Mark Ellis, Seismic Risk Specialist
James Rosewitz, Senior Engineer
The importance of a seismic ordinance and its building owner's response