Financial Management of Earthquake RiskThis white paper provides an overview of the following: 1) how financial risk is managed in the residential, commercial, small business, lifelines and government sectors; 2) how risk can be reduced, transferred or avoided through the use of insurance, mortgages and capital market instruments; and 3) how earthquake engineering expertise fits into this process. The discussion should be useful for the following audiences: 1) engineering students and faculty in understanding different career options that use engineering knowledge; 2) practicing engineers in understanding how the information they provide to various clients is part of the larger process of financial risk management; and 3) financial managers in gaining a better understanding of how the financial and earthquake engineering communities are interrelated. |
Contents
UNDERSTANDING RISK MANAGEMENT | 1 |
PUBLIC POLICY | 15 |
THE RESIDENTIAL SECTOR | 27 |
Copyright | |
7 other sections not shown
Common terms and phrases
agencies assets banks building codes business interruption capital markets cat bond catastrophe bonds catastrophic risk chapter cost coverage damage default developed diversification earth earthquake engineering earthquake insurance earthquake losses earthquake professionals earthquake risk assessment effects Emergency equity estimates evaluation event example facilities Fannie Mae fault federal FEMA financial decisions financial risk financial risk management Freddie Mac function funds government sector ground motion homeowner insurance companies investment investors Kunreuther lenders life-safety lifeline loans Loma Prieta earthquake loss exposures losses due major ment million mitigation measures models Mortgage-backed securities NEHRP Northridge earthquake options percent portfolio potential losses premium private mortgage insurance purchase quake rates reduce reinsurance repair residential risk management decisions risk reduction risk transfer risk-transfer role securitization seismic hazards seismic retrofit seismic risk Seismic Safety small businesses structure surance tion uncertainty vulnerability zones