Facts + Statistics: Earthquakes and tsunamis

World

2017 Earthquakes: On September 19 a powerful 7.1 magnitude earthquake jolted Mexico City and neighboring states, killing at least 216 people and leaving many trapped under collapsed buildings. A little more than a week previously, Mexico was hit by a magnitude 8.1 earthquake centered off its southern coast that killed at least 90 people.

2016 Earthquakes: A series of earthquakes in Japan on April 14 to April 16 was the most costly earthquake event in 2016, according to Munich Re. Those quakes, of 6.5 and 7.3 magnitude, caused $32 billion in overall losses and $6.2 billion in insured losses. 205 people lost their lives in the quakes. Also on April 16, a magnitude 7.8 earthquake struck Ecuador. At least 272 people died, and more than 2,500 others were injured. Overall losses were $2 billion and insured losses totaled $560 million, making it the third costliest quake in 2016.

In New Zealand, a 7.8 magnitude quake on November 13 killed 2 people and cause $3.9 billion in overall losses, and $2.1 billion in insured losses, ranking second in terms of losses in 2016. The February 5 6.4 magnitude quake in Taiwan ranked third worst in 2016. Damage was most significant in the city of Tainan, where several multi-story buildings collapsed. About 117 people died in the quake. Overall losses amounted to $700 million and insured losses reached $370 million. A series of earthquakes in Italy as high as 6.6 magnitude rounded out the top five quakes. The quakes, which stretched from Umbria to Rome on October 26 to 30, caused $6.5 billion in overall losses and $140 in insured losses, and killed 2 people.

On April 16, 2016 a magnitude 7.8 earthquake struck Ecuador. The quake caused 673 fatalities, more than 2,500 injuries and widespread damage in two provinces. It was the deadliest quake world-wide in 2016 and resulted in economic losses of $4 billion the costliest natural catastrophe to strike Ecuador, based on Swiss Re records. Insured losses totaled $0.5 billion.

On April 14, 2016, a magnitude 7.0 earthquake struck the Kumamoto prefecture of Japan. Twenty-eight hours later a magnitude 7.3 quake struck the region. Japanese officials have confirmed 41 deaths.

On February 6, 2016, a strong magnitude 6.4 earthquake struck southern Taiwan killing at least 117 people and injuring 550 others. Damage was most significant in the city of Tainan, where several multi-story buildings collapsed. According to Aon Benfield the Taiwan government allocated $750 million for recovery and rebuilding. The Financial Supervisory Commission cited preliminary insured losses at only $8.0 million.

On August 24, 2016, a 6.2 magnitude earthquake struck central Italy, killing about 300 people. It was followed by a series of aftershocks in October one of which registered magnitude 6.6, the most powerful to strike Italy since 1980. Combined, economic losses from the quakes totaled $6 billion. According to Swiss Re, only a fraction of these losses were covered.

2011 Earthquakes: On March 11, 2011 a devastating tsunami hit the coast of northeast Japan, triggered by a powerful earthquake approximately 80 miles offshore. The quake and tsunami caused $35.7 billion in insured damages, according to Swiss Re. Also, early in 2011 a powerful earthquake struck Christchurch, New Zealand, resulting in $15.3 billion in insured damages. The Japan and New Zealand quakes are among the 10 costliest world earthquakes and tsunamis, based on insured damages, according to Munich Re (see table).

World Insured Catastrophe Losses, 2008-2017 (1)

(2017 $ millions)

Year Weather-related
natural catastrophes
Man-made Earthquakes/tsunami Total
2008 $49,890 $9,547 $480 $59,917
2009 24,447 4,486 696 29,630
2010 32,869 5,364 18,211 56,443
2011 72,253 7,377 59,327 138,958
2012 68,714 6,275 1,825 76,815
2013 37,633 8,135 47 45,815
2014 30,094 7,286 324 37,704
2015 28,134 9,813 527 38,474
2016 38,695 8,377 8,863 55,935
2017 136,442 6,246 1,615 144,303

(1) In order to maintain comparability of the data over the course of time, the minimum threshold for losses was adjusted annually to compensate for inflation in the United States. Adjusted to 2017 dollars by Swiss Re.

Source: Swiss Re Institute.

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Top 10 Costliest World Earthquakes And Tsunamis By Insured Losses, 1980-2017 (1)

($ millions)

      Losses when occurred  
Rank Date Location Overall Insured (2) Fatalities
1 Mar. 11, 2011 Japan: Aomori, Chiba, Fukushima, lbaraki, lwate, Miyagi, Tochigi, Tokyo, Yamagata. Includes tsunami. $210,000 $40,000 15,880
2 Feb. 22, 2011 New Zealand: Canterbury, Christchurch, Lyttelton 24,000 16,500 185
3 Jan. 17, 1994 USA (CA): Northridge, Los Angeles, San Fernando Valley, Ventura, Orange 44,000 15,300 61
4 Feb. 27, 2010 Chile: Concepcion, Metropolitana, Rancagua, Talca, Temuco, Valparaiso. Includes tsunami. 30,000 8,000 520
5 Sep. 4, 2010 New Zealand: Canterbury, Christchurch, Avonside, Omihi, Timaru, Kaiapoi, Lyttelton 10,000 7,400 0
6 Apr. 14-16, 2016 Japan: Kumamoto, Aso, Chuo Ward, Mashiki, Minamiaso, Oita, Miyazaki, Fukuoka, Yamaguchi 32,000 6,200 205
7 Jan. 17, 1995 Japan: Hyogo, Kobe, Osaka, Kyoto 100,000 3,000 6,430
8 Nov. 13, 2016 New Zealand: Canterbury, Kaikoura, Waiau, Wellington, Marlborough, Picton 3,900 2,100 2
9 Jun. 13, 2011 New Zealand: Canterbury, Christchurch, Lyttelton 2,700 2,100 1
10 Sep. 19, 2017 Mexico: Puebla, Morelos, Greater Mexico City 6,000 2,000 369

(1) As of January 2018. Ranked on insured losses when occurred.
(2) Based on property losses including, if applicable, agricultural, offshore, marine, aviation and National Flood Insurance Program losses in the United States and may differ from data shown elsewhere.

Source: © 2018 Munich Re, Geo Risks Research, NatCatSERVICE; Wikipedia.

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United States

In 2019, the sparsely populated Ridgecrest City section of California was struck by a pair of significant earthquakes. On July 4 a 6.4-magnitude “foreshock” earthquake hit the area, followed by a stronger 7.1-magnitude quake the following day, along with a number of aftershocks. The 7.1 quake was the largest to hit the state in 20 years. According to Karen Clark and Co., insured losses from the quakes is estimated to total less than $40 million.

In 2018 a large 7.9 magnitude earthquake hit Kodiak Island, Alaska on January 23. No significant damage was reported from the quake or the insignificant tsunami that was observed in a handful of Alaska cities, according to the United States National Tsunami Warning Center. On May 4 a 6.9 magnitude quake struck the Big Island of Hawaii, caused by the eruption of Mount Kilauea. No significant damage was reported. As the eruption continued, a 5.5 magnitude earthquake was recorded on June 3. The eruption caused about 500 quakes in one day, and many aftershocks. On November 30 a 7.0 magnitude quake struck about 8 miles north of Anchorage, Alaska. It caused $130 million in insured losses but no fatalities were reported. There were about 2,000 aftershocks in the state in the days following the quake. The city’s major seismic improvements put into place after the 1964 magnitude 9.2 quake are credited for the limited damage from the November quake. The 1964 quake was the largest in the nation.

In 2017 the biggest earthquake in the United States was a magnitude 6.2 quake that occurred on May 1 in Skagway, Alaska. No significant damage was reported.

The 1994 Northridge quake was the costliest U.S. earthquake on record, causing $15.3 billion in insured damages when it occurred ($26.4 billion in 2018 dollars). It ranks as the eighth costliest U.S. disaster, based on insured property losses (in 2018 dollars). Six of the costliest U.S. quakes from 1980 to 2018, based on inflation-adjusted insured losses, were in California, according to Munich Re.

Top 10 Costliest U.S. Earthquakes By Inflation-Adjusted Insured Losses (1)

($ millions)

        Insured losses (2)    
Rank Date Location Overall losses
when occurred
Dollars when
occurred
In 2018
dollars (3)
Fatalities
1 Jan. 17, 1994 California: Northridge, Los Angeles,
San Fernando Valley, Ventura, Orange
$44,000 $15,300 $26,373 61
2 Apr. 18, 1906 California: San Francisco, Santa Rosa, San Jose 525 180 4,628 3,000
3 Oct. 17, 1989 California: Loma Prieta, Santa Cruz,
San Francisco, Oakland, Berkeley, Silicon Valley
10,000 960 1,926 68
4 Feb. 28, 2001 Washington: Olympia, Seattle, Tacoma; Oregon 2,000 300 430 1
5 Oct. 1, 1987 California: Los Angeles County, Whittier 360 75 164 8
6 Aug. 24, 2014 California: Napa, Vallejo, Solano,
Sonoma, American Canyon
700 150 159 1
7 Nov. 30, 2018 Alaska: Anchorage, Wasilla, Palmer, Tok, Valdez 150 130 130 0
8 Apr. 4, 2010 California: San Diego, Calexico, El Centro,
Los Angeles, Imperial; Arizona: Phoenix, Yuma
150 100 116 0
9 Oct. 15, 2006 Hawaii: Big Island, Kailua Kona, Oahu, Honolulu 200 50 62 0
10 Aug. 23, 2011 Virginia: Mineral, Richmond; DC;
New York: New York; Maryland: Baltimore
150 50 56 0

(1) Costliest U.S. earthquakes occurring from 1980 to 2018, based on insured losses when occurred. Includes the 1906 San Francisco, California, earthquake, for which reliable insured losses are available.
(2) Based on property losses including, if applicable, agricultural, offshore, marine, aviation and National Flood Insurance Program losses in the United States and may differ from data shown elsewhere.
(3) Inflation-adjusted to 2018 dollars by the Insurance Information Institute using the Bureau of Labor Statistics' Inflation Calculator.
(4) Inflation-adjusted to 2018 dollars based on 1913 Bureau of Labor Statistics data (earliest year available).

Source: © 2019 Munich Re, NatCatSERVICE; U.S. Department of Labor, Bureau of Labor Statistics; Insurance Information Institute.

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The previous chart ranks historic earthquakes based on their total insured property losses, adjusted for inflation. The chart below measures the estimated impact of historical quakes based on current exposures. The analysis of exposures as of end-2016 is based on AIR Worldwide's U.S. earthquake model. It makes use of the firm's property exposure database and takes into account the current number and value of exposed properties.

Estimated Insured Losses For The Top 10 Historical Earthquakes Based On Current Exposures (1)

($ billions)

Rank Date Location Magnitude 2017 insured loss
(current exposures)
1 1906 San Francisco, CA 7.8 $71
2 1811-1812 New Madrid, MO 7.7 59
3 1700 Cascadia Subduction Zone, WA, OR, CA 9.0 47
4 1838 San Francisco, CA 7.4 31
5 1886 Charleston, SC 7.3 30
6 1994 Northridge, CA 6.7 15
7 1868 Hayward, CA 7.0 15
8 1812 Wrightwood, CA 7.5 12
9 1857 Fort Tejon, CA 7.9 8
10 1989 Loma Prieta, CA 6.9 4

(1) Modeled loss to property, contents, business interruption and additional living expenses for residential, mobile home, commercial and auto exposures as of December 31, 2016. Losses include demand surge and fire following earthquake and account for tsunami, liquefaction and landslide. Policy conditions and earthquake insurance take-up rates are based on estimates by state insurance departments and client claims data. The model reflects recent updates to seismic and ground motion information as well as updated building characteristics of insured properties.

Source: AIR Worldwide Corporation.

A 2018 study by CoreLogic examines the financial implications of a hypothetical earthquake along the Hayward fault in the San Francisco East Bay area of California near the site of the 1868 Hayward California quake shown in the chart above. Including a series of aftershocks, such an event would lead to total damage of private property estimated at $170 billion, with only $30 billion recovered from homeowners insurance. CoreLogic explains that the difference between the total losses figure and the amount recovered is impacted by the lack of insurance for most properties in the state and to a smaller degree by the effect of insurance deductibles and limits.

Top 10 Writers Of Earthquake Insurance By Direct Premiums Written, 2018

($000)

Rank Group/company Direct premiums written (1) Market share (2)
1 California Earthquake Authority $774,296 23.8%
2 State Farm Mutual Automobile Insurance 268,092 8.3
3 Zurich Insurance Group 225,717 6.9
4 Chubb Ltd. 157,018 4.8
5 American International Group (AIG) 133,495 4.1
6 Travelers Companies Inc. 127,366 3.9
7 GeoVera Insurance Group 104,634 3.2
8 Palomar Specialty Insurance Co. 92,980 2.9
9 Liberty Mutual 82,584 2.5
10 AXA 75,591 2.3

(1) Before reinsurance transactions, includes state funds.
(2) Based on U.S. total, includes territories.

Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.

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Earthquake insurance

Standard homeowners, renters and business insurance policies do not cover damage from earthquakes. Coverage is available either in the form of an endorsement or as a separate policy. Earthquake insurance provides protection from the shaking and cracking that can destroy buildings and personal possessions. Coverage for other kinds of damage that may result from earthquakes, such as fire and water damage due to burst gas and water pipes, is provided by standard home and business insurance policies. Earthquake coverage is available mostly from private insurance companies. In California homeowners can also get coverage from the California Earthquake Authority (CEA), a privately funded, publicly managed organization. Only about 13 percent of California homeowners had earthquake coverage in July 2019, when Southern California was struck by the strongest quakes the state had felt in 20 years, according to the CEA.

Eleven percent of homeowners responding to a November 2018 poll by the Insurance Information Institute said they had earthquake insurance. Homeowners in the West were most likely to have earthquake insurance, with 17 percent saying they had the coverage, followed by the Midwest at 11 percent; the Northeast at 9 percent; and the South at 7 percent.

Earthquake Insurance, Direct Premiums Written By State, 2017 (1)

($000)

Rank State Direct premiums written ($000)
1 California $1,729,209
2 Washington 174,645
3 Missouri 94,412
4 Oregon 84,658
5 Tennessee 80,437
6 Illinois 64,832
7 New York 50,388
8 Utah 49,083
9 Kentucky 44,414
10 South Carolina 42,737
11 Indiana 36,885
12 Arkansas 32,767
13 Ohio 31,603
14 Texas 26,633
15 Alaska 25,121
16 Nevada 22,551
17 Massachusetts 22,336
18 Oklahoma 21,832
19 Florida 20,112
20 New Jersey 19,905
21 Mississippi 16,501
22 Virginia 16,334
23 Pennsylvania 14,942
24 Georgia 13,461
25 North Carolina 11,004
26 Hawaii 10,260
27 Colorado 10,131
28 Maryland 9,502
29 Arizona 7,291
30 Kansas                                                   6,742
31 Alabama 6,663
32 Connecticut 6,660
33 Michigan 6,368
34 Louisiana 6,283
35 Montana 4,989
36 Minnesota 4,456
37 Wisconsin 4,068
38 Iowa 3,745
39 Idaho 3,567
40 Wyoming 3,197
41 D.C. 2,837
42 New Hampshire 2,731
43 New Mexico 2,472
44 Rhode Island 2,139
45 Nebraska 2,077
46 Maine 1,947
47 Delaware 1,421
48 West Virginia 1,244
49 Vermont 910
50 North Dakota 593
51 South Dakota 378
  United States $2,859,475

(1) Includes the California Earthquake Authority, a state fund.

Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.

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  • Earthquake insurance direct premiums written rose 4.9 percent to $2.86 billion in 2017 from $2.73 billion in 2016.
  • California had the largest amount of earthquake premiums in 2017, at $1.7 billion, accounting for 60.5 percent of U.S. earthquake insurance premiums written. This figure includes the state-run California Earthquake Authority, the largest provider of earthquake insurance in California. The next highest ranking states were Washington state (6.1 percent of premiums) and Missouri (3.3 percent, Oregon (3.0 percent) and Tennessee (2.8 percent).

Earthquake Insurance, 2008-2017

($000)

Year Net premiums written (1) Annual percent change Combined ratio (2) Annual point change (3)
2008 $1,259,872 1.1% 33.5 3.5 pts.
2009 1,288,353 2.3 36.3 2.8
2010 1,443,598 12.0 41.4 5.1
2011 1,467,372 1.6 55.8 14.4
2012 1,593,451 8.6 36.3 -19.5
2013 1,586,985 -0.4 30.3 -6.0
2014 1,641,847 3.5 34.0 3.7
2015 1,649,753 0.5 28.1 -5.8
2016 1,535,142 -6.9 34.4 6.2
2017 1,511,543 -1.5 42.3 8.0

(1) After reinsurance transactions, excludes state funds.
(2) After dividends to policyholders. A drop in the combined ratio represents an improvement; an increase represents a deterioration.
(3) Calculated from unrounded numbers.

Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.

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