According to Verisk’s “Extreme Event Solutions” business unit, insured losses from the earthquake that struck near the Noto peninsula in Ishikawa prefecture, Japan, will be between approximately US $1.8 billion and $3.3 billion (JPY 260-480 billion).
The United States Geological Survey (USGS) reported on January 1st, 2024, the M7.5 earthquake on the west coast of Japan occurred due to shallow reverse faulting in the Earth’s crust, causing extensive damage around and south of the epicentre.
Verisk reported the Noto Peninsula earthquake also generated a tsunami of over one meter inundating many buildings along the shore, especially in Wajima, Suzu, and Noto.
The analytics company noted that most of the heavy damage occurred in Ishikawa prefecture and particularly in Wajima city. The event particulars included a large fire, damage from ground shaking and liquefaction observed in other prefectures such as Niigata and Toyama.
Although since 1981, building codes in Japan have been among the most advanced in the world and have been adopted and practised well. In the areas affected by the 2024 Noto Peninsula earthquake, seismic code requirements are higher than those in the southern part of Japan.
It should be noted that shallow earthquakes are known to cause more damage than intermediate and deep-focus ones since the energy generated by shallow events is released closer to the surface and therefore produces stronger shaking relative to earthquakes located deeper within the Earth.
The Noto Peninsula earthquake occurred on the west coast of Japan, where crustal deformation created by the broader plate motions is accommodated in shallow faults.
Notably, the USGS has added while earthquakes are common in Japan, the region surrounding the Noto Peninsula earthquake sees lower rates of seismicity as compared to the major subduction zone along its east coast.
Since 1900, still, there have been 30 other M6 and larger earthquakes have occurred within 250 kilometres of the January 1st event.
Verisk mentioned that its modeled insured loss estimates have not considered certain factors like losses to uninsured properties, along with losses to land, infrastructure, automobiles, and business interruption, both direct and indirect.
The modeled insured loss estimate has also not covered workers’ compensation losses, losses to civil engineering risks, marine cargo and marine hull risks, aviation risks, transit, warehouse risks, movable all risk, personal accident risks, loss adjustment expenses, losses from non-modeled perils, and demand surge.
According to an earlier analysis by Karen Clark & Company (KCC), the total insured losses from the earthquake were estimated to reach $6.4 billion, with residential losses accounting for over two-thirds of the total.
Meanwhile, CoreLogic estimated the insured loss from the quake at up to $5 billion.
