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• The most expensive natural disaster in history is thought to be the 2011 Tohoku earthquake and tsunami in Japan.
• Earthquakes cannot be predicted, so planning and preparation are key to building business resilience, including compliance with local seismic design codes.
• Secondary perils like landslides, fires, and ‘liquefaction’ should be mitigated against where possible.
• Artificial intelligence is being used to improve sensitive early warning systems.

The devastating twin earthquakes that struck Turkey and Syria hours apart in February 2023 affected 11 cities and caused the deaths of more than 55,000 people. For Turkey, it was the biggest such event in 500 years. A few months later, in September, an earthquake rocked the Atlas Mountains and Marrakech in Morocco, killing 3,000 people. In Italy, hundreds of tremors hit the region west of Naples, including a 4.2 magnitude earthquake at the end of September. Then in October, more than 2,400 people died when three earthquakes struck Afghanistan’s Herat province.

Around the world, there are estimated to be half a million detectable earthquakes every year, with 100 of them causing damage [1]. According to �ǿմ�ý Commercial data [2], earthquake/tsunami is the number five top cause of natural catastrophe loss, accounting for 6% of natural catastrophe claims by total value.

Along with a tragic toll on human life, earthquakes carry enormous financial costs. The economic losses from the Turkey-Syria earthquake are estimated to be around $91bn, with the Insurance Association of Turkey pegging total losses to the private insurance sector at TRY76bn ($4bn). The public Turkish Catastrophe Insurance Pool has received nearly 600,000 claims, with total payments expected to reach TRY29.5bn ($1.6bn) [3].

Those losses are significant, but by comparison, the 2011 Tohoku earthquake and tsunami in Japan – believed to be the most expensive natural disaster in history by economic losses ($360bn [4]) – incurred $47bn insured losses, while the 1994 Northridge earthquake in the US totaled insured losses of $31bn (sums adjusted for inflation in 2022 [5]). Estimated claims costs arising from the 2010-2011 Canterbury sequence of four earthquakes in New Zealand are believed to be more than $22bn [6].��

There is currently no reliable technology to predict when and where an earthquake will strike, says Ceyhun Eren, Director at �ǿմ�ý Teknik and Risk Engineering, in Turkey, one of the most seismically active countries in the world. “That is why we focus so much on prevention and preparation. By understanding the hazard and designing in earthquake resilience, we can reduce the potential damage to buildings and save lives.”

While seismic models are not predictions, they can tell us how often, on average, an earthquake of certain characteristics can happen in any given city or area. At the �ǿմ�ý Teknik Earthquake and Fire Testing and Training Center, an extensive facility in Istanbul, Eren’s team of researchers use ‘shaking tables’ to simulate the structural and non-structural damage earthquakes can wreak, along with hands-on training, helping to raise public awareness of what to expect when one strikes.

“Earthquakes cannot be prevented, but we can learn how to live with them,” says Eren. “People are never ready for that moment when the floor beneath their feet begins to shake. It’s like being on a moving bus that suddenly brakes, and you’re thrown forward [see panel].”

As with other natural perils, the risk for earthquakes consists of three elements: hazard, exposure, and vulnerability, says Mabé Villar Vega, Catastrophe Risk Research Analyst, �ǿմ�ý Commercial. “The hazard in this case is the probability of an earthquake happening, which doesn’t vary significantly over the long term, while the exposure represents your assets – your buildings and their contents, for instance. The vulnerability is how likely those assets are to suffer a loss, such as how likely a building is to sustain damage from, say, a magnitude seven (M7) earthquake happening at a certain distance.”

Growing urbanization increases exposure to earthquakes because it increases the number of vulnerable buildings. Vulnerability depends heavily on local building codes and enforcement. If new buildings are designed and constructed following modern seismic regulation, risks can be limited and even mitigated by retrofitting older structures that were not built according to modern codes.

“In the recent Morocco earthquake, much of the observed devastation occurred because many buildings were built using adobe or some other type of unreinforced masonry,” says Villar Vega. “These buildings are known to perform poorly in earthquakes, but because they are cheaper to build, they are common in earthquake-prone regions in developing countries.”

A change in building usage can also heighten risk. If a building is converted from residential occupancy to commercial premises, it can change the loads in a structure – a warehouse is likely to carry a heavier load than an apartment, for example, and there could be modifications to the building’s structure, such as the removal of walls to create space. Weighty solar panels might be added to the roof. All these factors increase vulnerability to earthquake damage.��

Earthquake risks do not begin and end with the ground shaking. Secondary perils such as landslides, tsunamis, and liquefaction – when the soil behaves more like a liquid than a solid during an earthquake – must all be mitigated where possible.

“Different types of soil can amplify an earthquake’s waves, leading to more damage for certain types of building,” says Villar Vega. “We have seen this in Mexico City, where the deep, soft soil contributed to earthquake devastation in the past. Cities built on sandy ground are particularly vulnerable to liquefaction, as was experienced after the Christchurch earthquake in New Zealand in 2011. Coastal cities are prone to tsunami risk, as was experienced by Lisbon after the historic earthquake of 1755.”

Earthquakes are not caused by the weather, says Villar Vega. “However, climate change could affect the probability of secondary perils occurring, such as landslides in a region that has become drier or wetter due to climate change, or liquefaction, which is dependent on the height of the water table. Over time, rising sea levels could introduce the threat of tsunamis to locations that have never faced this hazard before.”

Fires are a particular hazard following earthquakes, with potential gas leaks, the release of hazardous materials, damage to power plants, and explosions posing physical and environmental threats. Human health is also vulnerable to insanitary living conditions, the breakdown of essential utilities like power, water and communication, the lack of shelter, and sometimes criminal activity.��