June 20th, 2016

Potential Losses From the Kumamoto Earthquake: Part I

Posted at 1:00 AM ET

The catastrophe modeling firm RMS estimated the economic loss for property risks to be between USD2.5 billion and USD3.5 billion (1). This estimate includes only residential, commercial, and industrial property and contents. Catastrophe modeling firm AIR estimated the insured loss to be between USD1.7 billion and USD2.9 billion for property risks (2). Both catastrophe modeling firms’ estimates exclude infrastructure, business interruption and contingent business interruption.

The Japan Fire and Disaster Management Agency (FDMA) released its forty-fourth Kumamoto Earthquake Bulletin on April 28. The bulletin reports 65 fatalities, 332 severe injuries and 1,161 minor injuries. The bulletin also reports residential building damage of:

  • Total damage to 2,111 buildings
  • Half damage to 2,414 buildings
  • Partial damage to 9,592 buildings

For non-residential buildings, FDMA reported damage to 94 public buildings and 351 other buildings. They also reported 16 fires as a result of the earthquakes.

There is a potential for business interruption and contingent business interruption losses to companies relying on supplies from factories in the Kumamoto region. There are a number of industrial parks in the area that are shown in blue in the map below and some of the companies in these parks are highlighted in the table insert.

jer_chart-3

Link to Part II>>

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Note:

1. Source: RMS Own Event Response webpage update 27 and Asia Insurance Review, http://www.asiainsurancereview.com/News/View-NewsLetter- Article?id=35722&Type=eDaily

2. Source: http://www.air-worldwide.com/Facet-Search/Search-Results/

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