1. Bringing Science to the Art of Underwriting™ TM Welcome to Earthquake Country: Impact of future quakes Mary Lou Zoback, Ph.D. Vice President, Earthquake Risk Applications Risk Management Solutions Newark, CA Joint BARCfirst-BENS-BRMA Infrastructure Symposium June 25 th, 2009

2. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM 1989 M6.9 Loma Prieta simulation – Brad Aagaard, USGS 2 Available at http://earthquake.usgs.gov/1989

3. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM 1906 M7.9 simulation – Brad Aagaard, USGS 3 Available at http://earthquake.usgs.gov/1906

4. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM FORECAST: Major earthquake likely in the next 30 years

5. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM Major Faults in the San Francisco Bay Area

6. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM 6 Measuring plate motion directly with GPS

7. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM 7

8. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM

9. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM Mean Recurrence Past 12 quakes 165 ± 61 yrs Past 5 quakes 138 ± 58 yrs Past 9 quakes 151 ± 64 yrs

10. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM 10 18, (1836-1906) 70

11. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM FORECAST: Major earthquake likely in the next 30 years

12. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM Past 5 quakes 1906 M7.9 simulation – Brad Aagaard, USGS Silicon Valley perspective 12 Available at http://earthquake.usgs.gov/1906

13. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM Simulation of the 1906 Earthquake (Shawn Larsen, Lawrence Livermore National Lab) Directivity = Energy focused in direction of fault rupture

14. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM 1906 - The Big OneThe Bad One (Shawn Larsen, Lawrence Livermore National Lab)

15. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM 15 Vulnerable to floods - 1986 California’s Levee Problem  strong shaking causes liquefaction and collapse  Bay salt water rushes in  shuts down drinking water for 2/3 Californians (20-30% S CA water supply) Torres et al. (2000) Sacramento

16. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM WHO WILL PAY? 16

17. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM 17 Hurricanes Past Quakes Quake Scenarios $0.0 Historic losses from public records, scenario losses from RMS RiskLink 9.0

18. CONFIDENTIAL © 2008 Risk Management Solutions, Inc. TM 18 Hurricanes Past Quakes Quake Scenarios $0.0 Historic losses from public records, scenario losses from RMS RiskLink 9.0