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TRANSCRIPT
Presentation Overview
- What I know - Natural Hazards, Natural Disasters, Man Made Disasters,
Climate Change - What I think I know
- Life safety takes precedence over economic losses - Urbanization, demographic transition, population migration
- Expanding supply chains/interconnectivity imply increasing frequency/severity of disaster losses
- What I wish I knew - Impact of economic nationalism, balance between efficiency and
risk control (supply chain and cyber), economic value of disaster exposure
What I know – Natural Disasters
- Natural Events (Hazards) are almost impossible to predict
- Natural Disasters: - Are the interaction between natural conditions (earth movement,
weather, etc…) and human evolution - Involve some combination of the loss of life, property and
economic consequences - Are not well defined - Are changing through time and with climate change (excluding
earth movement, weather related events are changing) - Sea level rise is a given, not good news for some coastal
communities (think Miami and Manhattan)
Natural Disasters
- Deadliest Natural Disasters - China 1931 Floods: 1-4 million - Bangledesh 1970: 400,000 - Indian Ocean Earthquake/Tsunami 2004: 280,000 - Haiti Earthquake 2010: 230,000 (2.3% of population)
Natural Disasters
- Costliest Natural Disasters (insured losses, economic losses, property losses?) - 2011 Japanese Earthquake/Tsunami ($35B/$200B) - 2005 Katrina ($35B/$100+B) - 2008 Kobi Earthquake - 1992 Hurricane Andrew
- Note correlation (or lack there of)
Recent Natural Disasters
- What is recent? - Human vs. geological timeframes - Superstorm Sandy
- $26 Billion in Insured Losses? - Earthquake/Tsunami
- Japan 2011 - 16K+ killed, 330K buildings destroyed, nuclear meltdown - Ocean water 6 miles inland - Insured losses $35B, Economic losses $200B
- Earthquake Haiti - 230K killed of 10M, 2.3% of population killed
- 1918 Flu - 8M dead in WWI - 3% of world’s population died (50M)
Changing Natural Hazard Risk
0
500
1000
1500
2000
2500
3000
3500
1900
19
09
1909
19
15
1916
19
18
1921
19
26
1929
19
33
1933
19
35
1938
19
42
1944
19
47
1949
19
50
1954
19
55
1957
19
60
1964
19
67
1970
19
75
1980
19
84
1985
19
92
1995
19
99
2004
20
05
2005
# of Days Between Cat 3 Storms
Changing Natural Hazard Risk
Population Movement (phys.org)
Changing Windstorm Exposure
Historical Hurricane Tracks Tool, NOAA Coastal Services Center
Wildfire Risk Map
Earthquake Risk Map - US
What I know – Man Made Events
§ They are harder to predict than Natural Events/Disasters
§ That is ALL I KNOW!
What I think I know
§ Economic Effects of Disasters (both Natural and Man Made) will continue to grow: - Population migration - Urbanization in developing world - Demographic transition in developing world - Expansion of the supply chain (distance, just in time delivery)
- Interconnectivity/technology
Cargo – truly global Apple suppliers
MOL Comfort – going,going,gone !
Total claim c. $300m - $400m
Where is this ?
July to Dec 2011
Tianjin Port – Aug 2015
What I Wish I Knew
- What is the right balance? - Efficient day to day operations vs. post-loss operations/
recovery (loss control spending?) - Supply chain
» Quality assurance » Transportation » Time to Recovery » Secondary Correlations (supplier of a supplier)
- Cyber – Limits on the Evil of Man? » Privacy vs. efficiency » What information is critical vs. nice to have
What I Wish I Knew
- Risk of Economic Nationalism - Onshoring, Election 2016, Brexit, etc… - Walmart
- Economic Value of Disaster Exposure - Coastal development - Ports - Cheap labor vs political instability
- What builds resilience