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Mark Ellis – Thornton Tomasetti Peter Ziegler – TPA Godfreys
Christchurch Earthquakes
Lessons Learned & Implications for Insurance Claims
How Big of a Surprise Was It ? The Events
Intensity of shaking , Multiple Events Liquefaction
The Damage Settlement / Tilting Residential Buildings, Older Commercial Buildings Newer Commercial Buildings
The Response CBD Closed for more than 1 year Repair/Upgrade Procedures /Requirements in flux Volume, nature and fluidity of claims process
BIG BIG-ish
BIG Not really BIG
BIG BIG-ish BIG-ish
New Zealand Earthquakes
Christchurch, New Zealand
Australian Plate and Pacific Plate converge on the South Island of New Zealand.
Locations of Earthquakes/AfterShocks
Property Loss Consulting
Photo credit information here.
Christchurch, New Zealand
Earthquake Accelerations vs. Code
22 February 2011 Earthquake produced accelerations significantly higher than building (500 year) Code
Christchurch, New Zealand
Acceleration Comparison New Zealand vs. Japan
Christchurch – M6.3
Japan – M9.0
Property Loss Consulting
Christchurch vs. Japan
Liquefaction and Lateral Spreading Property Loss Consulting
Christchurch, New Zealand Photo credit information here.
Settlement / Tilting
> Acceptable limits of settlement are very subjective. > Repair methods are available, although challenging and somewhat unproven: - Piling, jacking, and grout injection.
> Christchurch, New Zealand
Newer Commercial Buildings
Some collapses: > CTV, PGG buildings (had been “green-tagged”). Others are very expensive to repair: > Tilting / re-levelling is expensive and unproven. > Structure permanently deformed. > Structural capacity depleted. > Seismic upgrade required.
Did these buildings meet the intent of the code?
> Christchurch, New Zealand
Issues Affecting Commercial Buildings > Plan Irregularities, lack of redundancy. > Concrete moment frame cracking
patterns, beam elongations. > Concrete wall cracking patterns
and rebar buckling. > Precast walls / grouting. > Precast floor systems. > Precast Stairs. > Exterior Precast Panels. > Settlement / Tilting.
Issues Affecting Commercial Buildings > Plan Irregularities, lack of redundancy. > Concrete moment frame cracking
patterns, beam elongations. > Concrete wall cracking patterns
and rebar buckling. > Precast walls / grouting. > Precast floor systems. > Precast Stairs. > Exterior Precast Panels. > Settlement / Tilting.
Issues Affecting Commercial Buildings > Plan Irregularities, lack of redundancy. > Concrete moment frame cracking
patterns, beam elongations. > Concrete wall cracking patterns
and rebar buckling. > Precast walls / grouting. > Precast floor systems. > Precast Stairs. > Exterior Precast Panels. > Settlement / Tilting.
Issues Affecting Commercial Buildings > Plan Irregularities, lack of redundancy. > Concrete moment frame cracking
patterns, beam elongations. > Concrete wall cracking patterns
and rebar buckling. > Precast walls / grouting. > Precast floor systems. > Precast Stairs. > Exterior Precast Panels. > Settlement / Tilting.
Issues Affecting Commercial Buildings > Plan Irregularities, lack of redundancy. > Concrete moment frame cracking
patterns, beam elongations. > Concrete wall cracking patterns
and rebar buckling. > Precast walls / grouting. > Precast floor systems. > Precast Stairs. > Exterior Precast Panels. > Settlement / Tilting.
Issues Affecting Commercial Buildings > Plan Irregularities, lack of redundancy. > Concrete moment frame cracking
patterns, beam elongations. > Concrete wall cracking patterns
and rebar buckling. > Precast walls / grouting. > Precast floor systems. > Precast Stairs. > Exterior Precast Panels. > Settlement / Tilting.
Issues Affecting Commercial Buildings > Plan Irregularities, lack of redundancy. > Concrete moment frame cracking
patterns, beam elongations. > Concrete wall cracking patterns
and rebar buckling. > Precast walls / grouting. > Precast floor systems. > Precast Stairs. > Exterior Precast Panels. > Settlement / Tilting.
Issues Affecting Commercial Buildings > Plan Irregularities, lack of redundancy. > Concrete moment frame cracking
patterns, beam elongations. > Concrete wall cracking patterns
and rebar buckling. > Precast walls / grouting. > Precast floor systems. > Precast Stairs. > Exterior Precast Panels. > Settlement / Tilting.
Commercial Building Example
Christchurch, New Zealand
> Failure of Concrete Shear wall – resulting in lean across boundary > Presence of old “plain round bars” makes wall repair challenging. > Hidden precast panel connection failures > Basement flooded and Penthouse “whipped” around
Commercial Building Example
Christchurch, New Zealand
> Failure of Concrete Shear wall – resulting in claimed “twist” > Severely damaged stairs > Configuration of walls and temporary stability complicates repair > Condition of foundations unknown.
Commercial Building Example
Christchurch, New Zealand
> Small well distributed cracking in well detailed shear walls > “Gravity structure” damaged by induced building movements > Tower settled more than podium > Pounding between adjacent structures
Industrial Facilities
Port of Lyttlelton, New Zealand
> Substantial damage to local ports and waterfront facilities. > Additional damage from EQs and aftershocks. > Need to evaluate proposed remedial design. Separate events. > Betterment ???
Developments and Changes Occurring > Royal Commission established. > CERA – take charge of recovery, including demolition > Red/Orange/Green zoning of residential > Re-planning of CBD – 7 story limit? > Seismic load factor increase – 0.22 to 0.3 > Evaluation/Repair/Upgrade Procedures being
developed “on the fly” > City Council will require all buildings to be evaluated > City Council - seismic retrofit required for buildings
< 33% code, or with fatal flaws. (may be decoupled from repairs, if building is not badly damaged)
Seismic Upgrade Requirement Ex
tent
of S
truct
ural
D
amag
e
Significant Required Now Recommended ?
Minor Required within X years Recommended None
None Required within Y years Recommended None
< 33% NBS (EPB) 33% to 67% NBS >67%NBS
Existing Seismic Capacity
Lessons Learned - Engineering Technical
> Liquefaction / settlement can be a big problem. > Irregularities & lack of redundancy are probs. > Conc. shear wall & moment frame design
inadequate? > Stairs, panels, non-struct. design inadequate? > Eval./repair/retrofit procedures need development
Process > Need to be very flexible > Need to be very pro-active– help steer process > Owner and their engineer can really complicate the
claims process. > Repair vs. Mitigation adds complication
Adjuster Experiences – Roles
> Examples of insurer taking on adjusting role - has expectation adjuster will support insurer’s actions - impacts on co-insurers and re-insurers
> Now appointing contractors directly to work for insureds > Engaging builders/surveyors to carry out an adjuster’s
role > Increasing in-house resource
Adjuster Experiences – Coverage > Sums Insured - inadequate due to no. of total losses > Demolition / debris removal costs large due to risk,
location within CBD > Inflationary increases due to supply and demand,
delays in reconstruction commencing > Inadequacy of professional fees cover , as professionals
involvement greater than the norm due to ongoing events, potential increased damage requiring further assessments, uncertainty surrounding reinstatement standards and enforceability
> Policy Sub limits, wording, e.g. “as-new”
City Council Factors > Has building owner been notified by CCC that it is
required to upgrade pre loss? - Does this constitute “notification” under the policy?
> Does CCC have the authority to enforce the increased target level for EPB?
- If it does what are the additional costs and are they recoverable under the policy? - Is the sum insured sufficient if these costs are significant?
Currently, there are differing views from insurers as to whether the CCC has the authority.
Other Insurance Challenges > An insurer dealing in the domestic arena is reputed to
have in the region of 1800 dwellings ready for reinstatement works to be completed. It is unable to purchase CAR insurance, so no works have commenced.
> The ground continues to move and settle. Further damage occurs and costs will increase.
> When is an appropriate time to reinstate? > How does this relate to due despatch requirement
under the policy?
Other Insurance Challenges
> Some Insurers are no longer offering earthquake insurance. Others are offering at increased rates with large deductibles.
> There is no certainty of future earthquake insurance availability.
Practical Challenges
> Lack of suitably qualified adjusting resource in NZ, generally accepted UK Chartered Loss Adjusters have requisite skills and blend well
> Most ‘Cat’ adjusters attend for finite periods, up to say 3 months. This has now been operating for over 13 months. This brings its own unique challenges.
> ‘Cat’ costs are significant involving numerous events, airfares, accommodation, transportation etc.
The Future in NZ
> Adjusters handling larger valued losses
> Claims handlers handling larger valued losses
> Will be likely that overseas adjusters will want to settle in NZ
> More experienced adjusters in NZ, more future competition
> Insurers handling claims differently as above
Implications for other Events/Locations?
> Engineering
> Adjusting
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