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Earthquake Risk Transfer for Chile

Earthquake Risk Transfer for Chile; Short-term earthquake loss
Fig.1 - Hashed circles represent current Earling undercover regions.

The Chilean Andes, as a characteristic tectonic and geomorphological region, is a perfect location to unravel the geologic nature of seismic hazards. The Chilean segment of the Nazca-South American subduction zone has experienced mega-earthquakes with Moment Magnitudes (Mw) >8.5 (e.g., Mw 9.5 Valdivia, 1960; Mw 8.8 Maule, 2010) and many large earthquakes with Mw >7.5, both with recurrence times of tens to hundreds of years. By contrast, crustal faults within the overriding South American plate commonly have longer recurrence times (thousands of years) and are known to produce earthquakes with maximum Mw of 7.0 to 7.5. Subduction-type earthquakes are considered the principal seismic hazard in Chile, with the potential to cause significant damage to its population and economy. However crustal (non-subduction) earthquakes can also cause great destruction at a local scale, because of their shallower hypocentral depth. Nevertheless, nature, timing and slip rates of crustal seismic sources in the Chilean Andes remain poorly constrained (Santibáñez, et al., 2019). Chile is one of the 5 regions that Earling pilot tests launched there.
The north and center of Chile received accurate EPAs, which means citizens in the specified regions can prepare for most of the significant events.

Chile short-term expected earthquake loss

Earthquake risks need to be transferred? download the report.

How EPA Affects Recent Insured Losses

Fig.2 - PML - Mean return period in years. Chile Average Annual Loss is about $2,396 million (Chile Disaster & Risk Profile, 2014). EPAs that are not supported by a First Notice increase insurance loss.
Fig.3 - EPA effect on the 16 Sep 2015 Chile earthquake (SwissRe, 2016).