Turkey earthquakes – industry insured losses likely to exceed $1 billion

Turkey earthquakes – industry insured losses likely to exceed $1 billion | Insurance Business America

Turkey earthquakes – industry insured losses likely to exceed $1 billion

Extreme Event Solutions at Verisk (formerly AIR Worldwide) has revealed its estimates for the losses caused by the February 6 earthquakes in Turkey – with economic losses likely to exceed US$20 billion (approx. £16.4 billion) while industry insured losses are estimated to exceed US$1 billion.

The estimated figures are derived from the impacts of both the M7+ earthquakes that occurred on Feb 6, 2023, and results from Verisk indicate that the initial shock is the driver of the majority of the insured losses.

Commenting on the report, Bill Churney, president of Extreme Event Solutions, Verisk emphasised that the devastating earthquakes caused a tragic loss of life as well as extensive physical damage.

“The sizable difference between insured and economic losses—the protection gap—represents the cost of catastrophes to society, much of which is ultimately borne by governments,” he said. “Increasing insurance penetration can ease much of the burden.

“There are solutions available that can enhance global resilience efforts including, emergency management, hazard mitigation, public disaster financing, risk pooling, and other government-led risk- and loss-mitigation initiatives.”

Turkey’s history of earthquake occurrence

A report identifying the steps taken to protect Turkey’s people and infrastructure noted that the country has a high rate of earthquake occurrence. Since 1900, approximately 12 earthquakes of magnitude 5.0 and greater and one event of magnitude 6.0 and greater have occurred in Turkey each year.

Verisk highlighted that notable historical events in Turkey include the 1939 magnitude 7.9 ─░zmit earthquake, the 1999 magnitude 7.5 ─░zmit earthquake, and the 1999 magnitude 7.2 Düzce earthquake.

“Turkey has a long history of building codes and regulations that have been developed to ensure the safety and performance of buildings against earthquakes,” the report identified. “Current codes reflect the latest advancements in building technology and seismic design practices almost in parallel with changes in the US seismic code.

“Despite these efforts, the seismic performance of buildings in Turkey during earthquakes has been mixed. Buildings complied with codes have performed relatively well, while many others have experienced significant damage and collapse during earthquakes.”

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