BOSTON, Feb. 23, 2011 – Catastrophe modeling firm AIR Worldwide estimates that industry insured losses from the moment magnitude 6.1 earthquake that struck New Zealand’s South Island near Christchurch on February 22nd (February 21st UTC) will be between NZD $5 billion ($3.5 billion USD) and NZD $11.5 billion ($8 billion USD). The quake caused extensive damage in the city center and was the second major quake to strike the city in six months.
It is still in the very early aftermath of yesterday’s earthquake that struck near Christchurch on New Zealand’s South Island, and damage assessments are only just beginning after the initial focus on search and rescue. Damage in this city of about 375,000 people is widespread, and aftershocks, of which there have been several, remain a concern. (Note that while seismological agencies are reporting a local (Richter) magnitude of 6.3 for this earthquake, this translates to a moment magnitude (Mw) of 6.1 according to calculations made by the USGS.)
“Christchurch is New Zealand’s second largest city, and while design requirements for new construction are stringent, many historical buildings dominate the central business district, and they are predominately of masonry construction,” said Dr. Arash Nasseri, engineer at AIR Worldwide. “Few have undergone seismic retrofit. Structures may also have been weakened by the magnitude 7.0 earthquake that took place in early September of last year. Although Tuesday’s quake—considered to be part of the aftershock sequence of the September event—was smaller in magnitude, it has been more damaging because it was closer to the center of Christchurch and occurred at such a shallow depth.”
The government of New Zealand has declared a national state of emergency in order to facilitate the coordination of local, national and international rescue and recovery efforts. Hardest hit was the city's central business district, which remains largely shut down. Rows of masonry buildings crumbled and those buildings still standing will have to be carefully assessed for structural integrity.
According to AIR, the city’s infrastructure has also been hard hit, with many roads and bridges damaged as a result of liquefaction. In the city’s suburbs and surrounding towns, ground failure manifested in the form of liquefaction, lateral spreading and landslides.
“The largest magnitude earthquake to strike New Zealand since modern instrumental record-keeping began was a Mw 7.8 event in 1931, known as the Hawke’s Bay earthquake,” explained Dr. Nasseri. “That disaster prompted the significant revision of New Zealand’s building code that has given the country one of the most stringent in the world today.”
South Island, on which Christchurch is situated, has an active fault zone in the north, which includes a region known as Porters Pass-Amberley Fault Zone and two others, the Alpine fault zone and the Hope fault zone. “Most known historic earthquakes on South Island have occurred in this 200-mile wide collision plate boundary zone,” added Dr. Nasseri. “This area forms the southern part of the collision zone along the Pacific-Australia plate boundary. The Pacific plate subducts under New Zealand’s North Island and terminates under South Island, about 100 miles north of Christchurch. The plate boundary forms another collision zone that extends across South Island.”
Note to editors
AIR's insured loss estimates reflect:
• Insured physical damage to property (residential, commercial/ industrial), both structures and their contents
• Direct business interruption losses
The loss estimates do not reflect:
• Losses to uninsured properties
• Losses to land
• Losses to automobiles
• Losses to infrastructure
• Indirect business interruption losses
• Loss adjustment expenses
• Losses from non-modeled perils, including fire-following and landslide
• Demand surge—the increase in costs of materials, services, and labor due to increased demand following a catastrophic event.
About AIR Worldwide
AIR Worldwide (AIR) is the scientific leader and most respected provider of risk modeling software and consulting services. AIR founded the catastrophe modeling industry in 1987 and today models the risk from natural catastrophes and terrorism in more than 50 countries. More than 400 insurance, reinsurance, financial, corporate, and government clients rely on AIR software and services for catastrophe risk management, insurance-linked securities, detailed site-specific wind and seismic engineering analyses, agricultural risk management, and property replacement-cost valuation. AIR is a member of the Verisk Insurance Solutions group at Verisk Analytics and is headquartered in Boston with additional offices in North America, Europe, and Asia. For more information, please visit www.air-worldwide.com