Insured losses from latest Mexico quake could reach $2bn
The first estimates have been released of the anticipated industry insured losses from the M7.1 earthquake that struck central Mexico on September 19.
According to catastrophe modelling firm AIR Worldwide, losses will be between Mex$13.0 billion ($730 million) and Mex$36.7 billion ($2 billion).
RMS has estimated that while economic losses will be between $4 billion and $8 billion, because of low insurance penetration rates across Mexico, particularly in residential lines, insured losses will not exceed $1.2 billion.
RMS added that this estimate accounts for shake-only insured losses to structures, contents and business interruption including the effects of liquefaction and landsliding. Post-event loss amplification is not expected to be a significant factor in these losses.
AIR added that, while the M7.1 Puebla earthquake comes only 11 days after the M8.1 earthquake that occurred 650 km to the southeast—and both events were related to the subduction of the Cocos plate beneath the North American plate—the M7.1 event occurred too far north along the subduction zone to be an aftershock of the September 7, 2017, earthquake according to the USGS.
This M7.1 earthquake occurred in central Mexico, roughly 55 km south-southwest of the city of Puebla and 120 km southeast of Mexico City, where major damage and hundreds of fatalities have been reported. The President of Mexico declared a state of emergency for areas impacted by the M7.1 quake. In Mexico City, 52 buildings collapsed, including a 10-unit apartment building, a four-story school, and a three-story textile factory; about 500 more buildings were damaged throughout the capital, including 22 hospitals, several churches, a sports arena, and a medical laboratory.
According to the Federal Electricity Commission, power was restored on the night of September 21 to 4.63 million households and business, representing 95% of those that had lost power after the quake, mostly in Mexico City and in the states of Guerrero, Morelos, Puebla, Oaxaca, and Tlaxcala. Telephone lines were downed, and gas mains were ruptured. Schools in the region have been closed until further notice.
According to AIR, the majority of residential buildings in Mexico are of masonry construction, falling into one of three classifications: reinforced masonry, confined masonry, and unreinforced masonry. Unreinforced masonry is the construction type most vulnerable to shake damage. Commercial buildings in Mexico are primarily of engineered masonry or concrete construction, and are better able to withstand ground motion. In Mexico City, most middle- to upper-class families live in five- to 15-story reinforced concrete commercial dwellings. These buildings are generally well designed and built with high quality materials. However, reinforced masonry and confined masonry buildings still account for a large portion of the building stock of Mexico City.
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