How to prepare a business for an earthquake

The human toll of the catastrophic earthquake that hit Turkey and Syria on Feb. 6, 2023, is difficult for most of us to fathom. When a horrific event such as this occurs, it underscores the devastation that such natural risks exact on our world.

It is no wonder that natural catastrophes (Nat Cat) consistently rank in the top ten of global business risks in Allianz’s annual Risk Barometer. In 2023, Nat Cat fell three positions to the sixth spot, overshadowed by seemingly more pressing developments on the risk landscape such as the war in Ukraine and the aftermath of COVID-19.

There is no room for complacency for individuals or businesses, however, as this earthquake has shown once again that a single Nat Cat event can result in the tragic loss of thousands of lives and financial losses in the billions of dollars.

Nature’s most severe natural hazard

Earthquakes are one of nature’s most severe natural hazards. The amount of ground movement that occurs in an earthquake is dependent upon the magnitude, the duration, the distance from the fault and the local geological conditions. The United States Geological Survey estimates that there are 500,000 detectable earthquakes in the world each year and 100 of them cause damage.

While earthquakes cannot be accurately predicted or prevented, the potential damage resulting from an earthquake can be mitigated by understanding the hazard and by planning carefully. It is important to note that most U.S. building codes are intended to prevent the collapse or failure of a building for the primary purpose of reducing loss of life. These provisions will not necessarily prevent damage to a building or allow for a quick and simple repair.

Damage from an earthquake can range anywhere from a minor inconvenience to a major catastrophe. Buildings can suffer both structural and non-structural damage.

Infrastructure damage can include broken automatic fire sprinkler systems and flammable gas piping, the shifting of major production and utility equipment, and the toppling of finished products in rack storage. This damage can lead to a significant business interruption.

In an effort to help minimize the damage to businesses that may occur as a result of an earthquake, the following checklist outlines the steps that should be completed before, during and after an earthquake. This checklist is not intended to be all inclusive and should be used as a guide, taking into consideration your specific site conditions and processes.

Pre-earthquake planning

The key to minimizing earthquake damage is adequate preparation before the event. If your site is subject to earthquakes, the following should be completed:

• Develop a comprehensive, written earthquake emergency plan to mitigate the exposures. The plan should include:
• Assigning emergency organization roles and responsibilities
• Providing training at least annually.
• Assembling emergency supplies and equipment, such as tools, fire extinguishers, portable electric generators, emergency lighting, medical supplies, etc.
• Planning for salvage and recovery, including maintaining a list of key vendors, contractors, and salvage services.
• A business continuity plan for restoring operations after the event. The plan should be reviewed at least annually and updated as needed.
• Verify equipment, especially tall, slender objects, is properly braced and/or anchored to prevent movement, such as:
• Production & process equipment.
• Flammable liquid or gas piping.
• Fire protection systems, such as sprinkler piping, water tanks, fire pumps, drivers and controllers, etc.
• Utility equipment, such as boilers, HVAC equipment, cooling towers, air compressors, generators, transformers, switchgear, etc.
• Storage tanks, silos and bins.
• Storage racks and shelving.
• Computer server equipment racks.
• Any suspended equipment, such as space heaters, suspended ceilings, piping, electrical bus ducts, etc.
• Tall office furnishings, such as filing cabinets, bookcases, etc.
• Install seismic shutoff valves on all flammable liquid and gas piping systems. For main natural gas and propane service lines, install the seismic shutoff valve between the utility meter and where the piping enters each building.
• Provide flexible gas connections between gas-fired equipment and piping.

During an earthquake

If safe to do so, consider shutdown of:

• Production & process equipment.
• Building utilities, such as electricity, gas, domestic/process water, compressed air, HVAC, steam, etc. Important: Always maintain fire protection systems in service.
• Computer server equipment.

After an earthquake

• Secure the site to prevent unauthorized entry.
• Organize and prepare emergency crews for salvage and cleaning operations.
• If safe to do so, conduct an immediate damage assessment, paying particular attention to the following:
  • Structural damage to the building.
  • Fire protection equipment, maintaining as much fire protection in service as possible by isolating damaged sections, then making repairs and restoring systems back to service as soon as possible. Notify ARC if any system will be impaired for more than 10 continuous hours.
  • Utilities, including electricity, gas, water, compressed air, HVAC, steam, etc. (isolate as necessary).
  • Production & process equipment.
  • Any combustibles in contact with potential ignition sources, such as electrical or heating equipment.
• Notify utility companies of any outages or damage.
• Call in key personnel and notify contractors to begin major repairs. Make sure facility safetyprocedures are fully implemented before work commences. This includes controlling ignition sources such as smoking and hot work. Follow all hot work permit procedures.
• Initiate salvage operations; however, be aware the fire danger is greater soon after earthquakes.
• Review the effectiveness of the earthquake emergency plan and revise as needed.

This year’s lower ranking for Nat Cat in the Allianz Risk Barometer illustrates how it can recede from public awareness when other events dominate the headlines.  It is important for events such as earthquakes, tornadoes, hurricanes and other natural catastrophes to stay high on companies’ risk agendas, with business continuity plans remaining updated and tested, even in times of economic or geopolitical turbulence.

Andrew Higgins, P.E. is the senior regional technical & expertise manager at Allianz Global Corporate & Specialty. He is based in North Carolina.

Opinions expressed here are the author’s own.

Related:

• Proactivity is the key to mitigating earthquake risk
• These earthquakes, tsunamis led to the biggest insurance losses
• 5 ways to protect your assets from earthquake losses