1. General Session - The Big One
Robert J. Curry, FCAS
Insurance Services Office

2. The Big One Historical Hurricane Activity What’s Changed
Hurricane -- What Ifs
Historical EQ Activity
EQ -- What ifs
Mitigation

4. HURRICANE HISTORY LONG-TERM FREQUENCY OF HURRICANES
Ten year moving average

5. Largest Insured Hurricanes 1949-1999
Reported
Rank Year Name Losses ($B)
Andrew 15.5
Hugo 4.2
Georges 3
Opal 2.1
Floyd 2
Source: ISO’s Property Claim Services

6. What has changed?
Population Growth

7. Growth In Population Density

8. What has changed? Population Growth Inflation
Amount of Property per person

9. Amount of Property per person
Size of new home has increased
1645 square feet in 1975
2190 square feet in 1998
% of homes with 4 + bedrooms
21% in 1975
33% in 1998
% of homes with 2 1/2 or more baths
20% in 1975
52% in 1998
source: US Department of census

11. Largest Insured Hurricanes 1949-1999
Adjusted Rank Year Name Losses ($B)
Andrew 22.9
Betsy 7.4
Hugo 7.4
Cecelia 4.2
Georges 3.1

12. Hurricane -What Ifs
Hurricane Bret
Hurricane Gloria
Hurricane Andrew

13. Hurricane Bret In 1999 made landfall south of Corpus Christi
$30 million in damage
Made landfall in Galveston, Texas today?
Potential Modeled Losses => $11.6 Billion
Source: Applied Insurance Research, Inc.

14. Hurricane Gloria
In 1985 passed over Cape Hatteras, NC as a Cat 3 & made landfall in Long Island as Cat 2.
$400 million reported; $850 million adjusted
Made landfall in Long Island, NY as a Cat 4 today?
Potential Modeled Losses => $25 Billion
Source: Applied Insurance Research, Inc.

15. What if Hurricane Gloria…
Made landfall in Brooklyn, NY as a Cat 4 today?
Potential Modeled Losses => $39 Billion
Source: Applied Insurance Research, Inc.

16. Hurricane Andrew
What if storm like Andrew made landfall in downtown Miami today?
Potential Modeled Losses => $50 Billion
Source: Applied Insurance Research, Inc.

17. Largest Insured Loss EQs since 1940
Reported
Rank Year Name Losses ($B)
Northridge 12.9
Loma Prieta 1.2
Source: ISO’s Property Claim Services

18. Earthquakes - What Ifs 1886 Charleston, SC 1906 San Francisco
New Madrid

19. 1886 Charleston EQ M7.3 in Charleston SC MMI 10
Estimated insured damage if happened today
$10 Billion
Source: Risk Management Solutions

20. 1906 San Francisco EQ 1906 San Francisco EQ M8.3
Significant fire following damage
Estimated insured damage if happened today
$36 Billion
Source: Risk Management Solutions

21. 1811-12 New Madrid EQ 1811-12 => series of 4 EQs over 7 week period
MMI 10+
Estimated insured damage if happened today
$88 Billion
Source: Risk Management Solutions

22. Mitigation Efforts BCEGS Community graded based on
Building Code Effectiveness Grading Schedule
Community graded based on
building code in force
enforcement of that code
Credits associated with better grade
4,600 communities evaluated
approved in 48 states

23. Good versus Bad Construction Practices - Hurricane Andrew