RMS Helps Out in Haiti
The Impact of Hurricane Season — in 2075
How Prepared Are You for Hurricane Season?
Moving Forward After Christchurch
Directional Changes in Loss for the New Zealand Earthquake HD Model
Plan Your Move to Version 16.0
How to Build a Stronger Haiti
"What would happen to my home if another earthquake struck Haiti? Nothing at all." Hear Guerda's Haiti story (pictured right), and how RMS partner Build Change (literally) builds stronger communities.
Many of us will never experience an earthquake. And if we do, our built environment has increasing resilience weaved into it, whether it's through strong buildings, safe infrastructure, or simply education and awareness. But we know this certainly isn't the case across the world, especially in developing countries.
Watch our video and hear Guerda's story. Guerda lives in Haiti, where on January 10, 2010, an earthquake made 1.6 million people homeless – around 15% of the entire population – and killed around 160,000 people, mainly from collapsing buildings.
Guerda's home was badly damaged. With her baby son, she sought shelter in one of the 1,500 or more tent cities. These tent cities brought their own problems, poor sanitation, risk of disease, and safety concerns, especially for women. With her son sick with fever, Guerda decided to move back to her house. A neighbor told her about a charity called Build Change, and Guerda has not looked back.
"Build Change did so much work on my house, I can't even tell you. They strengthened the cracked walls, replaced columns that didn't have a solid base."
RMS partners with Build Change, a social enterprise founded in 2004. Its mission is to greatly reduce deaths, injuries, and economic losses caused by housing and school collapses due to earthquakes and typhoons in emerging nations. In Haiti alone, since 2010, it has helped 137,836 people to rebuild or repair their homes.
Each year, several RMS employees join Build Change projects for our annual Impact Trek, and for each of the last three years, 2014, 2015, and 2016, our team has spent a week in Haiti. Our employees use their skills directly on local projects and see firsthand the progress being made to rebuild a safer, stronger Haiti.
What did our Impact Trek team learn from visiting Haiti? Chesley Williams, Senior Project Director at RMS, felt it brought home the reasons why she is in this industry.
"The best opportunity for me was to get out there and teach about earthquakes to the Build Change staff, and they had a lot of questions. I helped to better understand the experience they had, but to also make it clear that Haiti has a future where there will be more earthquakes, and they need to be prepared.
"It gets to the roots of what RMS is and what we are here to do, and a lot of us got into this business to save the world, ultimately, get people prepared, and for me personally, I wanted to get back to those roots, and I would encourage anyone to do the same."
Eric Dratell, Senior Vice President at RMS, saw the difference building resilient homes made to the people of Haiti.
"I spoke to a guy where simply having a home that you have a lot of confidence that it's going to survive the next earthquake was so very important to him, and it was very moving to hear him talk and to see the kids playing around there. These were kids who were around houses that they knew weren't going to fall around them in the next couple of minutes, so they play like normal kids, and play with confidence."
And as for Guerda, what did she feel would happen to her rebuilt house if another earthquake struck Haiti?
"Nothing at all. It's very solid. Thank you to all the engineers, thank you Build Change."
Join us on our Impact Trek 2017. We are looking to invite our customers to help on our next Impact Trek, if you would like more details please feel free to reach out to Rebecca Biestman at Rebecca.Spitzer@rms.com.
Get the Resources You Need for the Atlantic Hurricane Season
We are now over a month into the six-month official Atlantic hurricane season, and the RMS Event Response team is ready to help clients prepare for a potentially busy season with a range of resources.
Examining the season outlook, forecast groups are expecting near- to above-average hurricane activity this season, although there is a wide spread in the exact expected numbers, with between 10-19 named storms, 4-10 hurricanes, and 1-4 major hurricanes forecast. Read our Atlantic Hurricane Season Outlook now.
To discover the full extent of the support provided by the RMS Event Response team during the season, read our Event Response Products and Services for the 2016 North Atlantic Hurricane Season document, also an audio presentation describing the hurricane outlook. A v16 Ensemble Loader for U.S. hurricanes is also available.
RMS in New Zealand – Moving Forward from the CES
With thanks to our organizers, the Insurance Council of New Zealand (ICNZ) and the New Zealand Earthquake Commission (EQC), RMS held seminars in Wellington and Auckland during early June, plus a series of one-to-one meetings in Sydney. At our roadshows, Hemant Shah, CEO of RMS, talked with senior executives in the region to explain how our new RMS New Zealand Earthquake Model sits at an important intersection of science, insurance, and policy in a dynamic environment.
Consider these facts. The tragic Canterbury Earthquake Sequence (CES), starting from September 2010 and culminating on February 22, 2011, brought 17 loss-causing events in and around Christchurch, a city with a population of 400,000, resulting in US$30 billion in losses, or 20% of New Zealand's total GDP. New Zealand also has the second-highest insurance penetration rate in the world, second only to The Netherlands.
The severity of the CES, combined with this high insurance penetration, saw a US$25 billion insured loss – the world's second-highest insured earthquake loss. The CES did highlight the importance of insurance and reinsurance to national economic stability; it would be far worse if the bulk of the 20% GDP loss had not been insured.
Since the CES, RMS has developed a new earthquake model. Studying the Christchurch area has revealed a great deal about liquefaction, and there has been a surge in research on ground motion simulations and extensive field work to improve the mapping of faults, with a paradigm shift in our ability to estimate liquefaction hazard.
We welcomed over 80 attendees in Wellington, including representatives from central and local government as well as research partners. Our Auckland event was more insurance focused, with over 110 attendees discovering details on model changes and best practices for handling exposure data and using the new software.
How the CES Has Changed New Zealand Insurance
At our roadshows, we discussed how New Zealand had previously experienced a period of very small EQ losses, but the CES has turned the local insurance market on its head, for instance, changes to residential policies. Almost uniquely in the world, they were previously written on an open-ended replacement basis, now they are mainly sums-insured.
CES has affected New Zealand's government bodies. The Earthquake Commission's (EQC) natural disaster fund was exhausted from paying CES claims. While that fund is being rebuilt and reviewed, the scheme's Crown guarantee sees taxpayers liable for any losses not covered by EQC's extensive reinsurance program.
While natural perils in general have been considered in the ongoing strategic risk assessments of the New Zealand Treasury and the Department of Prime Minister and the Cabinet for some time, local governments now have to quantify and manage their natural peril risks with an understanding that central government is no longer willing to pick up the bill for repairs.
Regulations have tightened, new solvency requirements for the insurance industry from the Reserve Bank of New Zealand began just as the CES started. A 1,000-year solvency requirement is due for introduction later in 2016, in an industry used to 200 or 250 years. 1,000-year is prudent. Wellington, New Zealand's capital city, is located right on top of an active fault line (with an annual recurrence interval on the order of 1,000 years) with little diversification of the risk of ruin in what is a highly consolidated insurance market.
Regulation has a wider impact than New Zealand. With the two largest New Zealand insurers sharing approximately 75% of the market share and all headquartered in Australia, the Australian Prudential Regulation Authority (APRA) is also monitoring developments in New Zealand, with insurers having to comply with both RBNZ and APRA solvency requirements.
From the natural disaster of the CES, these events have galvanized all parties together to ensure greater resilience for any future New Zealand earthquake event.
Insights into Directional Changes in Loss for the Updated New Zealand Earthquake HD Model
Our team of RMS earthquake experts have released a number of new items relating to the RMS New Zealand Earthquake HD Model. These include the New Zealand Earthquake HD Model: Executive Briefing #2 – Directional Changes and a second webinar, with a video New Zealand Earthquake HD Model: Webinar #2 – Directional Changes and slide deck. In addition to providing a summary of the new features in the model, these two items also provide directional guidance on changes in loss and insights into the drivers of those changes.
For information on the major new features for the New Zealand Earthquake HD Model, see the New Zealand Earthquake HD Model: Scope of Update also on RMS Owl.
Plan Your Move to Version 16.0
Version 16.0 is now available via electronic and physical distribution. Our 2016 Resources Page has information about current or upcoming version 16.0 resources and documentation. This version 16.0 release incorporates a combination of data- and methodology-driven updates to several existing models and data products, including the RMS Europe Windstorm Clustering Model, the U.S. and Canada Severe Convective Storm Simulation Platform, and the complete suite of RMS terrorism solutions. In addition, RMS has introduced new functionality to model marine and cargo exposure and new data to assess all major sources of U.S. flood hazard.
Current distribution of version 16.0 impacts all primary products, including RiskLink ALM and DLM, RiskLink Enterprise Grid Computing (EGC), Hosted RiskLink, RiskBrowser®, RiskBrowser Online, RiskTools®, and RMS® Simulation Platform Data. Updated versions of RiskManger and the RMS Probabilistic Terrorism Model also accompany the release.
Additional secondary products, including RMS® HailCalc Europe and the RMS® Data Quality Toolkit, are targeted for release later in summer 2016. For more information on the impacts and release timelines for RMS primary and secondary products in version 16.0, please refer to the RiskLink and RiskBrowser 16.0: Overview Presentation.
Learn about the Scope and Rationale of the North America Earthquake Version 17.0 Update
In the first quarter of calendar year 2017, RMS will release a comprehensive update to the North America Earthquake suite of models for the United States, Canada, and Mexico. A robust communication plan is in place to help clients prepare for this new view of risk.
The version 17 release will be a comprehensive update that includes changes to seismic sources incorporating data from the 2014 U.S. Geological Survey (USGS) National Seismic Hazard Mapping Project and the Geological Survey of Canada, as well as including the latest scientific view of the Mexico Subduction Zone. The release will also include enhancements to liquefaction, landslide, ground motions, soil amplification and basins, fire following earthquake, tsunami, casualty, vulnerability, and industry exposure databases (IEDs). For more information, read the scope executive briefing, the scope of update, and watch the scope webinar on RMS Owl.
Take Advantage of New Europe Inland Flood Hazard Data
Central Europe has recently seen some of the most severe flooding since 2013, with multiple countries affected over a period of 1-2 weeks. While severe, damage would have been much worse had flood defenses not been in place, protecting properties in potentially high hazard zones. This blog by Adrian Mark and Rachael Whitford explores the impacts of the recent flooding, looking at how it could have been much worse without the presence of flood defenses.
RMS has modeled flood risk in Europe for almost 20 years, and this month we expanded our flood offering in the region, releasing a suite of Europe Inland Flood hazard data products, including high-resolution return-period flood maps, peril rating databases, and XML return-period flood accumulation footprints. Derived from the forthcoming Europe Inland Flood HD Models, this suite of data products provides our clients with a consistent view of risk from risk selection and pricing through to portfolio management.
The RMS Europe Inland Flood maps are the highest-resolution flood hazard mapping tool available, with the most extensive number of return periods and flood-depth bands in the market, as well as detailed flood-defense information. This provides (re)insurers with the detailed knowledge required to make confident underwriting decisions.
The RMS Peril Rating Databases (PRDs) can be used alongside the hazard maps, forming a complete underwriting solution across risk selection and pricing. The databases have been created using RMS flood hazard and vulnerability modeling expertise, providing annual loss ratios for exposure at risk of flooding, supporting exposure screening and rating at the point of underwriting.
The RMS XML return-period flood accumulation footprints and RMS Europe Inland Flood Maps also provide the tools necessary to evaluate accumulations of flood risk in a portfolio, ensuring (re)insurers are not overexposed. These footprints provide existing RiskLink licensees with the means to understand the potential extent of flooding in Europe, while the high-resolution inland flood maps, when accessed via RMS(one)® Exposure Manager, will provide detailed insights into the potential extent and severity of flooding across Europe.