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In-depth insight into Earthquake Risk and Its Impact on Businesses

Oct 01, 2023
Blog author

Martin Hald

Understand Your Exposure

For businesses, it’s essential to understand and accurately assess their exposure to earthquakes. This requires a detailed analysis of a company’s assets, including buildings, property, and potential business interruption, and CBI. Information such as building age and other COPE (Construction, Occupancy, Protection, and Exposure) data play a crucial role in assessing the real exposure and vulnerability to earthquakes.

Asset Modeling and COPE Information

Comprehensive asset modeling, encompassing all aspects of a business from buildings to property, is crucial for obtaining an accurate picture of a company’s total value and risk exposure. COPE information adds an extra layer of insight, enabling companies to more precisely assess the vulnerability of their assets to earthquakes.

Setting Risk Appetite with Natcat Calculations

A Natcat calculation can be useful for companies to set their risk appetite. This assists companies in making informed decisions about their risk management strategies, ensuring they are best prepared to handle the consequences of an earthquake.

But how do we calculate the risk appetite?

  1. Integrate geo-coded #NatCat data with your company’s with your site values.

  2. Incorporate crucial COPE (Construction, Occupancy, Protection, and Exposure) information.

  3. Measure and amalgamate these with your company's risk profile.

The result?

A comprehensive, single risk appetite metric that steers the decision of insurance purchase. 📊💼 Ensure your company is safeguarded from the unexpected and can continue to thrive amidst uncertainty. Be prepared, be informed, and manage your risks effectively with a robust NatCat Calculation strategy! 💪

Understanding Earthquake Intensity and Its Impact

Understanding the earthquake intensity scale, such as the (MMI) Modified Mercalli Intensity Scale , is crucial. This scale measures the observed effects of an earthquake and is divided into 12 levels. Here are some examples:

Here is a brief overview of the Mercalli intensity scale:

  • I (Not noticeable): The tremors are not noticeable to people but can be registered by seismographs.

  • II (Very light): The tremors are faintly noticeable to some people at rest.

  • III (Light): Tremors are felt indoors but rarely outdoors.

  • IV (Moderate): Tremors are felt by many people indoors and by some outdoors. No damage to buildings.

  • V (Quite strong): The tremors are felt by almost everyone, and some objects may fall.

  • VI (Strong): Minor damage to poorly built buildings and slight damage to well-built buildings.

  • VII (Very strong): Damage to most buildings, some severe.

  • VIII (Destructive): Significant damage to buildings, bridges, etc. Panic breaks out.

  • IX (Devastating): Severe damage to many buildings, bridges, roads, and railways. Panic breaks out.

  • X (Very devastating): Most buildings, bridges, roads, and railways are destroyed.

  • XI (Extremely devastating): Almost all buildings are destroyed.

  • XII (Destruction): The landscape changes, and objects are thrown into the air.

This gives businesses insight into how an earthquake of a given strength can impact their operations and what measures can be taken to minimize damage. This enables companies to plan and implement appropriate measures to protect their assets and ensure business continuity.


By having access to and understanding relevant and accurate information about earthquake risk and exposure, companies can better prepare for and mitigate the risk of damage caused by earthquakes. This not only ensures a company's survival in the event of a disaster but also protects employees, assets, and investments in the long term.

In-depth knowledge and preparation are the keys to navigating the complex world of natural disasters and ensuring that your business continues to thrive regardless of circumstances.