An earthquake that affected a large part of England earlier today will cause insured losses of between ?15 million ($29.8 million) and ?30 million ($59.5 million), according to initial estimates by Risk Management Solutions (RMS).
A British insurance association said the event would likely cost insurers somewhere in the low tens of millions of pounds.
Jonathan French, assistant director of media relations for the Association of British Insurers, said that the earthquake will have no significant adverse impact on insurers.
According to Boston-based AIR Worldwide, the British Geological Survey (BGS) estimated a Richter magnitude (ML) of 5.2 for the earthquake, and the U.S. Geological Survey (USGS) assigned a moment magnitude (Mw) of 4.7.
The BGS said the earthquake was the largest experienced in the United Kingdom since 1984. Earthquakes of this size generally occur on the U.K. mainland around every 30 years, BGS added.
RMS in Newark, Calif. reported that the earthquake's epicenter was near Market Rasen, in rural Lincolnshire. RMS added that shaking was felt across England, and minor tremors occurred in central London.
While RMS noted that damage was reported throughout a wide area, Andrew Sorby, model manager for Europe earthquake at RMS, said in a statement that damage was somewhat mitigated by the rural setting of the earthquake's epicenter.
“Fortunately, the earthquake's epicenter appeared to be in a fairly rural part of Lincolnshire,” Mr. Sorby said. “Had it occurred closer to one of the nearby towns and cities where the populations are far larger, we could be looking at a very different situation in terms of the damage caused.”
Mr. Sorby noted that residential properties are at risk during earthquakes due to the nature of their design. “In global terms, the U.K. is at relatively low risk of earthquakes, and only in extreme cases will buildings collapse and cause injuries and fatalities. But as residential properties are generally not designed to withstand shaking, even small earthquakes can cause damage by cracking walls and overtopping chimneys, for instance,” he said.
Earthquake insurance is included in most homeowners and commercial business policies, RMS noted.
This article updated Feb.28, 9:56 a.m. EST
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