‘Disaster and Emergency Relief
Framework’
IRDA, NDMA & FICCI
Seminar
A Presentation
Man-made Disasters versus Act of God
by
Mr. Yogesh Lohiya
CMD, GIC Re
11th August 2010, New Delhi
Section I
Act of God?
-A Global Perspective
2
Disasters
Natural Vs Man-made
• Man-made (generally localized) Industrial
accidents.
• Natural (Act of God) (area of spread is
vast) Earthquakes/ Tsunami/ Cyclones.
• High Volume of losses in both cases.
• Mitigation (long term process) & relief
measures (immediate) cannot be largely
different.
• Preventive measures are not a general
trend and largely ignored by the society.
3
Disasters
Natural Vs Man-made
• People do not voluntarily adopt simple
and cost effective loss prevention
measures
• Underestimate the likelihood of a
disaster more so happening to them.
• Myopic behavior impedes the process
of loss prevention.
• Faith in the government to take steps to
prevent & protect from disasters.
4
Catastrophes : Some Facts
• There are twice as many people on Earth today
as there were in 1950.
• A greater concentration of values than in 1950.
– 4 times more globally
– 6 times more in third world countries
• Most of the growth concentrated in coastal
areas
– More prone to weather risks (cyclones)
5
Catastrophes: Some Facts
• Catastrophes are more frequent now
–3 fold increase in numbers as in 1950
• Catastrophes are more severe in intensity
–8 fold increase in severity as in 1950
• Increase in insured losses- 15 X.
6
Catastrophes in 2009
• Total Catastrophes:
– Natural Catastrophes:
– Man made Catastrophes:
• Loss of lives:
– Natural Catastrophes:
– Man made Catastrophes:
288
133
155
15,000
9,000
6,000
7
Number of Cat Events-1970-2009
300
250
200
150
100
50
0
1970
1975
1980
1985
Man-made disasters
1990
1995
Natural catastrophes
2000
2005
Swiss Re, sigma No 1/2010
8
Nat Cats in 2009
• Hydrological disasters (floods) remained
the most common disasters in 2009,
accounting for 53.7 percent.
• Followed by storms (hurricanes)
accounting for 25.4 percent.
• Geophysical disasters (earthquakes,
volcanoes) accounted for 2.7 percent.
9
Nat Cat :1970-2009
Cyclone Nargis, Myanmar (Burma)
EQ, tsunami Indian Ocean
Cyclone Gorki, Bangladesh
100,000
Earthquake Tangshan, China
1,000,000
Storm in Bangladesh
Earthquake in Peru
Number of Victims
10,000
1,000
1970
1975
1980
1985
Natural catastrophes
1990
1995
2000
2005
Man-made disasters
10
Swiss Re, sigma No 1/2010
Catastrophes in 2009
• Economic damages:
US $ 62 billion
– Natural Catastrophes:
US $ 41 billion
– Man made Catastrophes: US $ 21 billion
• Cost of Man-made disasters (insured
losses):
US $ 4 billion
11
in USD bn,
indexed to 2009
140
60
Attack on WTC
80
Winter storm Lothar
Hurricane Andrew
100
Northridge earthquake
120
Hurricane Ike, Gustav
Hurricanes Ivan, Charley et al
Hurricane Katrina et al
Insured Cat Losses 1970-2009
40
20
0
1970
1975
Earthquake/tsunami
1980
1985
Man-made disasters
1990
1995
2000
Weather-related Nat Cats
2005
Total
12
Swiss Re, sigma No 1/2010
Section II
Exposure to Natural
Catastrophes in India
13
INDIA –
Vulnerability To Natural Catastrophes
• Indian sub-continent
considered one of the most
hazard-prone countries in
the world
• 85% of land area
vulnerable to various types
of Natural Catastrophes
14
EARTHQUAKES
•
Seismically active
•
59% of prone to EQs
•Four EQs above 8 & ten
above 7.5 on Richter Scale in
the last 100 years.
•Seven in the last 2 decades
•Dense Population & Old
Construction adds to the
problem.
15
CYCLONES
•8041 km long coastline
•Large Coastline; large
population; large destruction.
•Tropical Cyclones generally
strike Eastern coast
•Western Coast too is struck
•Thunderstorms (Nor’westers)
common in NE, NW, Central &
SW India
•Cyclone associated strong
winds & rains compound the
destruction.
•Floods & Coastal Inundations
too are a risk.
•15 cyclones have struck the
Indian coast in last 100 years.
16
FLOODS
•
•
•
•
•
•
India is the 2nd most flood
affected country after
Bangladesh
40 mln hectares land mass
prone to floods; 8 mln hectares
affected annually.
Rising population;
developmental activities in flood
plains make it more disastrous.
Climate change also makes
weather volatile leading to
disasters.
Avg. Annual Loss:
US$ 400Mln.
Urban Floods & Inundations
are a new phenomena now.
• Mumbai Floods (2005)
17
Section III
Are Natural Catastrophes
Act of God?
18
Cat Events in India
• “Disastrous Weather Event” in Leh on
6.8.10
• IOC Jaipur Fire 2009
• Mahul Oil Installations in Mumbai
• Surat Floods 2005
• Mumbai Floods 2005
• Plague/H1N1 Flu/ Bird Flu- 1994/ 2009 &
2010
19
Catastrophic EventsImpact on India
• Loss of Life & Property on a large scale
• Majority of the affected uninsured
• Direct Losses due to natural disasters
amount to (average per annum)– 2% of India’s Gross Domestic Product
– 12% of Federal Government’s Revenues
• All alleviation/ mitigation efforts postevent
• Disruption of Trade & Commerce
20
Catastrophic EventsImpact on India
• Some of the worst CAT losses have
occurred in India
• Top in natural-disaster-caused mortality in
2009: 1806 victims in India
• Low values & Low penetration are the
causes
• Catastrophe Risk Mapping is not complete
• Detailed data is not available
• Geographical Position makes us vulnerable
to events occurring in neighbouring areas.
– (Tsunami/ Earthquakes)
21
Thank You
22