March 2014

Over fifty years ago not only a major turning point toward a better understanding of earthquakes occurred, but also the large-scale motions of Earth's lithosphere. Read on.

The atmosphere is always electric at the annual SIFMA-hosted Insurance- & Risk-Linked Securities Conference. A million handshakes, tons of one-on-one meetings taking place wherever folks can find a private corner, and an array of panels offering innovative thought from true market leaders and advocates. 

This week greeted Los Angeles residents with a bit of a jolt, as a 4.4 magnitude earthquake struck the area early Monday morning, just a few miles northwest of downtown.

You’d have to be living under a rock not to know that the NFIP is $24 billion under water and that the Biggert-Waters Flood Insurance Reform Act of 2012, intended to make the program more financially stable, has been gutted. The Biggert-Waters could require the NFIP to increase rates significantly for some older properties in high-risk areas. The resulting outcry has led to proposals to delay or eliminate many of the increases.

The word “seiche” might just be a life saver in a game of Scrabble—but what on earth does it mean? Pronounced “saysh,” it is a Swiss French dialect word meaning to sway back and forth and is used by hydrologists to describe an oscillating wave form found in enclosed or partially enclosed bodies of water.

A stitch in time, they say, saves nine—and retrofitting an older home to protect against major hurricane or earthquake damage can save a bundle down the road in repair costs and lower insurance premiums. In California, which experiences more than 37,000 earthquakes a year (granted, all but a few are too small to be felt) and has two-thirds of the nation’s earthquake risk, stringent building codes aim to ensure that modern construction will sustain minimal damage during quakes. But most of the property in the state is older, and having been constructed to lesser standards, is not so resilient.

Even as Southern England is cleaning up after devastating floods and the wettest January in nearly 250 years, many of us are likely wondering when and where the next catastrophe will occur. Since their debut in 1987, catastrophe models have become an integral part of risk management.