Insurance, or rather a lack of insurance, is only part of the issue when it comes to dealing with the fallout of disasters both natural and manmade. Local communities need to get their head out of the sand first and address communal resilience, according to the president and CEO of
Swiss Re Canada.
Veronica Scotti recently expressed concern that Canadians are suffering from a disaster myopia, when it comes to disasters like earthquakes.
“’It’s not that bad,’ or ‘it’s not my responsibility’. That’s precisely the sentiment - spoken and unspoken - many have towards earthquakes,” the Swiss Re CEO said. “Otherwise, why would only 4% of residential dwellings in Montreal and 60% of dwellings in Vancouver be insured against earthquake? It stems from a feeling people have that “the big one” won’t happen even though they live in an active seismic zone, or if it does, the government will pay them to rebuild.”
But in a recent blog posting, Scotti said that rather than point fingers, we, as a society, need to recommit ourselves to “communal resilience” and construct a “whole of society” approach to managing risks and consequences of disasters.
In the last few days of 2015 a magnitude 4.7 quake struck about 20km north of Victoria and while no one was hurt and there was no damage it drew uncomfortable attention to a difference of about $2.1bn between insured losses and economic losses, assuming an average catastrophe loss year.
Putting that in the context of an earthquake, the
Insurance Bureau of Canada (IBC) estimates the overall costs from a 9.0-magnitude quake in British Columbia at nearly $75bn. A 7.1-magnitude quake in the Quebec City-Montreal-Ottawa corridor would cause an estimated $61bn in economic losses.
“Clearly, insurance coverage in-force would be inadequate to foot that bill,” Scotti said.
The communal resilience approach is based on three pillars: physical, social and economic. The stakeholders come from local and national government as well as the private sector and each must play its role in upholding those pillars:
- Physical: enacting risk mitigation strategies, building codes and investing in infrastructure
- Social: ensuring that vulnerable populations are appropriately cared for; also an acculturation of sorts, where citizens take responsibility for and invest in the soundness of their property and personal safety
- Economic, because where our physical resilience ends, our financial resilience must begin
“And as a nation we must take the threat of earthquakes seriously in order to protect…the places where we work, where our children attend school, where we shop and enjoy cultural and recreational activities and maybe most importantly, the places where we live,” Scotti said.
“We won’t get to a state of resilience until we recognize that earthquake preparedness in all its forms is a collective responsibility.”
