Probabilistic Seismic Risk Assessment in Manizales, Colombia: Quantifying Losses for Insurance Purposes

Abstract

A fully probabilistic seismic risk assessment was developed in Manizales, Colombia, considering assets of different types. The first type includes elements that are part of the water and sewage network, and the second type includes public and private buildings. This assessment required the development of a probabilistic seismic hazard analysis that accounts for the dynamic soil response, assembling high resolution exposure databases, and the development of damage models for different types of elements. The economic appraisal of the exposed assets was developed together with specialists of the water utilities company of Manizales and the city administration. The risk assessment was performed using several Comprehensive Approach to Probabilistic Risk Assessment modules as well as the R-System, obtaining results in terms of traditional metrics such as loss exceedance curve, average annual loss, and probable maximum loss. For the case of pipelines, repair rates were also estimated. The results for the water and sewage network were used in activities related to the expansion and maintenance strategies, as well as for the exploration of financial retention and transfer alternatives using insurance schemes based on technical, probabilistic, and prospective damage and loss estimations.In the case of the buildings, the results were used in the update of the technical premium values of the existing collective insurance scheme.

Risk Transfer for Populations in Precarious Urban Environments

“…Disaster Risk Evaluation The four metrics calculated for the two hazards, seismic (Cardona 2018b) and landslides (Cardona 2018a), used in these assessments include: (1) Exceedance Probability (EP) Curve-the annual frequency with which a certain economic loss will be exceeded; (2) Average Annual Losses (AAL)-the expected losses per year; (3) Pure Risk Premium (PRP)-the cost that must be paid annually to cover the expected losses in the future; and (4) Probable Maximum Losses (PML)-the loss value for a given exceedance frequency, or for its inverse, the return period (Marulanda et al 2014). Details of the probabilistic risk assessment methodology can be found in Cardona (1986) and Salgado-Gálvez et al (2017).…”

Seismic risk scenarios for the residential buildings in the Sabana Centro province in Colombia

“…Recently, a seismic risk assessment and a set of earthquake scenarios were developed for the residential building stock of Colombia's three largest metropolitan centers: Bogotá, Medellín, and Cali (Acevedo et al, 2020). In addition, probabilistic seismic risk assessments have been conducted in cities such as Medellín (Salgado et al, 2014) and Manizales (Salgado et al, 2017;Carreño et al, 2017). Despite these efforts, there is still a need to assess the expected consequences of potential earthquake events in other parts of the country.…”